The Swiss Franc increased in value against 16 other currencies on worries that the situation in the Middle East and North Africa may bring about a disruption of oil supplies. Furthermore, a report showing acceleration in February’s inflation gave rise to speculation regarding a possible hike in interest rates.
Meanwhile, the Euro currency traded mixed; the 17-nation currency weakened against most of its counterpart currencies as Portugal was asked to make a bigger payment during a debt auction. This showed that investors are concerned about the fact that the region is having a tough time containing the debt crisis. However, the Euro rose somewhat on rumors that the European Central Bank may buy securities from the countries in debt. Evidence of such a move was supported by the ECB’s inquiry into the prices of Irish Bonds. The British Pound rose against the greenback as reports indicated that trade deficit went down and exports rose to a record high.
Yesterday’s FX news revealed that the central bank of New Zealand lowered interest rates by 50 basis points, thus causing a drop in the currency’s value.
In Canada, the central bank raised its second-quarter foreign exchange rate forecast for the Euro versus the Dollar as ECB’s President Jean-Claude-Trichet hinted at increasing the cost of borrowing money.
Australia’s Dollar dipped in value on the announcement that home-loan approvals diminished for the first month of the year. The monetary unit recovered after Glenn Stevens, Governor of the Reserve Bank of Australia’s, reaffirmed that this did not indicate a major problem.
David Sumner is a freelance writer with a specialization in reporting on the world of finance. David holds a B.A. from the University of Maryland. Currently David is based in the U.S. but spends a good portion of the year traveling throughout Europe and Asia.
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