The British pound fell against the dollar and euro today with UK inflation data

The US dollar strengthened vs. most major currencies today with favorable US data. US capital inflows came in strong as foreign investors bought a net of $143.4 billion in securities in September. US producer prices fell a record 2.8% in October with help from sharply lower commodity prices. Core producer prices had an unexpected rise of 0.4% in October, above forecasts of a 0.1% rise.

The euro was lower against the dollar today as investors continued into the safety of the dollar. With no major economic news from the Euro-Zone, the euro is tracking US data.

The British pound fell against the dollar and euro today with UK inflation data.
Data showed that annual CPI eased to 4.5% in October from a 16-year high of 5.2% in September. This gives the Bank of England more room to further cut interest rates in order to bolster the economy.

The Japanese yen stayed near 96-97 yen levels against the dollar with risk aversion from deepening concerns about a global recession. Economic Minister Kaoru Yosano said that the Japanese economy may not return to growth until 2010. The economy has slipped into its first recession in seven years after growth contracted in Q2 and Q3.

The Canadian dollar recovered against the dollar today as crude oil prices nudged higher after hitting lows. Oil fell to 22 month lows today at $54.15 as oil prices continue to slide on demand concerns.

The Australian dollar was lower against the dollar with dovish comments from the Reserve Bank of Australia. Minutes from the RBA meeting showed continuing concerns over the economy and a high probability of future rate cuts from the current 5.25%. Weakness in the global economy also means demand for commodities will continue to slow down, hurting the commodity-linked currency.

The New Zealand dollar fell against the dollar with weak stock markets and concerns over global economic health renewing risk aversion among investors. The kiwi will continue to track global equity markets.

The Mexican peso weakened against the dollar with continued worries over the US economy. Over 80% of Mexico’s exports go to the US.