#GBP gains 3.5% on the #EUR last week – 20th July 2015

Greek citizens in Greece will be pleased to hear they can now take out more money from their bank account; €420. But hang on a minute, they are only allowed to take out €420 a week which works out…€60 a day.

Ironic as it may appear, it is a step towards normality, and another will come in a couple of days when the stock market opens again. Despite this “progress”, investors punished the Euro again for the sixth consecutive day on Friday, meaning it ended the week taking a five cent hit against Sterling. Or 3.5%.

The NZ Dollar was the winner on Friday, rebounding from six-year lows against Sterling on the rationale that investors are reining in their expectations for Thursday’s Reserve Bank of New Zealand policy decision. Towards the end of last week there had been talk of a 50-basis-point cut that would lower the Official Cash Rate from 3.25% to 2.75%. Today the prediction it that it will go down no further than 3%.

The US Dollar was the second-best-performing major currency on Friday, adding half a cent against Sterling and three quarters of a cent against the Euro. It was helped by confirmation that US inflation had turned positive hitting 0.1%. reinforcing the view that American interest rates will move higher this year.

On Friday’s close Sterling was roughly steady against the Canadian Dollar and the South African Rand but ended the day up by an average of 0.2% against the other dozen most actively-traded currencies, cementing its first-place position for the week with an average gain of 2.3%.

There is very little to on today’s economic calendar with no data whatsoever from the US. Earlier this morning China’s house price index showed a tenth month of decline while Germany’s producer price index fell fractionally in June and was down by -1.4%. Rightmove’s index of asking prices for UK residential property went up by 0.1% in July and is 5.1% higher than for the same month last year.

Tonight the Reserve Bank of Australia publishes the minutes of its July policy meeting. Pick the bones out of that.