The pound dollar exchange rate is 0.042% higher with 1 GBP = 1.6508 USD. The euro dollar exchange rate is 0.035% lower with 1 EUR = 1.4319 USD. With equity markets in the poor state that they currently find themselves in it’s no surprise that investors wanted to fill their pockets with US dollar as opposed to the single currency. The string of disappointing data sent shivers through the global markets, with a growing number of risk averse investors dumping the Euro and therefore pushing the EUR/USD pair down 132 ticks to finish at 1.4295. It seems to be the same feeling today, as we’re currently seeing it trade at 1.4315. Looking at the week ahead for the euro exchange rate Bank of America analysts say that the key theme will be that of ECB intervention: "In the Eurozone, speculation is likely to continue about how far the ECB interventions in the periphery sovereign market could go, following the rejection of a Eurobond scheme at the Merkel-Sarkozy meeting. Concerns about the new Greek aid package may also come to the fore. "More details will emerge about the recent agreement between Finland and Greece that effectively voids much of the contribution of the former to the new EFSF financing package for the latter." Other issues of concern will once again be economic growth. "After the inflation data this week surprised to the upside in the US and UK, the focus returns to growth expectations at the core of Europe with the German ZEW and IFO, as well as GDP revisions in the US and UK. With the weak Q2 GDP prints remaining fresh in the market’s mind, the EUR is likely to be very sensitive to a downside surprise, as this pushes against the trend in the data, and would confirm the negative flow seen recently from our Hedge Fund and Real Money client base"

Source