Tell Us About Your Transfer
We'll Tell You Where to Get the Best Rate!
While Europe recently saw a contraction in service industry numbers, the sector is thriving across the Atlantic according to a report released in the US today. Employment in the private sector also saw better-than-expected results, however both sets of data were outweighed by signs of ever decreasing global economic growth.
Investors reverted to their risk aversion strategies as the likelihood of a rise in US unemployment also being announced on Friday increased. Analysts are expecting the increase to be around 0.1%, taking the total jobless to 8.2% for the month of September.
The primary element of most risk aversion strategies is moving funds to the US dollar, as it is considered to be the most stable of all currencies due to it being the world’s most traded currency and the single currency of the worlds largest economy. This lead to the dollar making gains of 0.5% on the yen and 0.15% on the euro, while the yen also fell against the euro by 0.35%
Euro maintains strength after Spanish denial
The euro has maintained its progress from the last few days, despite the rejection of speculation that Spain would be officially requesting a bailout later this week by Spanish Prime Minister Mariano Rajoy. The Spanish government have been stalling with their formal request for quite some time due to concerns over the austerity measures that would be expected of them. The European Central Bank offered terms early last month with their new bond purchasing programme, aimed at nations in financial crisis such as Spain, however they are yet to respond. Should Spain continue to resist what many feel is inevitable the markets could soon turn on them and begin to apply pressure, forcing them into a decision.
Rial decline leads to protests
The recent decline of the rial, the sole currency of Iran, has led to protests in Tehran. Riot police have been deployed in an effort to contain the protests, which are becoming violent. Less than 24 hours ago President Ahmadinejad was pointing the finger of blame in the direction of the western world, citing their championing of the current trade restrictions placed on the middle eastern country.
The embargo restricts the flow of Iranian exports and currency, which lead to the rial falling by 17% on Monday and wiping out significant portions of wealth in the stricken country. The embargo will not be lifted until Iranian officials agree to cease their nuclear power program, which the western world fears could quite easily and discreetly be transformed into a nuclear weapons program.
The protests are piling yet more pressure on President Ahmadinejad, who is quickly losing the trust of his people. Should the protests continue and erupt into further violence the government may well have their hands tied due to the possibility of the UN stepping in if excessive force is used as they would also bring an end to the nuclear power program at the same time.