As the Conservative party conference kicked off this week, the optimism was in stark contrast to the depressed state of the UK economy. The pound has remained at stable, albeit low levels this week, trading at in the region of 1.59 against the US dollar and 1.08 against the euro. Both the Bank of England and ECB voted to leave interest rates on hold, while the US dollar has risen against the yen as the Fed moves towards an exit strategy.

Sterling exchange rates have remained low this week, falling slightly against the euro and US dollar following weak economic data in the UK. The pound began the week on a bad note after UK industrial production figures fell -2.5% in August, while manufacturing sunk by -1.9%. House prices however continue to rise, with Halifax figures showing a 1.6% rise in September and the Bank of England voted to leave interest rates on hold.

The US dollar has retained strength this week as markets retain a sense of cautious optimism over economic recovery. Currency rates for the greenback fell early in the week as the dollar's relationship to oil trading were called into doubt. Later in the week the dollar shrugged off this uncertainty and oil remains in the region of USD69 a barrel amid growing demand from the Asian economies.

The US dollar has completed three consecutive weeks of gains against the pound and is heading for its largest gain in two months against the yen. The US trade balance is out this morning and we could be due for some more dollar volatility as the Federal Reserve proceeds with an exit strategy.

Euro currency rates have remained high this week, riding a wave of euro confidence as figures continue to indicate recovery in the eurozone. The single currency has been trading in the region of 1.47 against the US dollar and 0.92 against the pound and economists are predicting there could be a euro correction at some stage.

This week second quarter GDP figures came in at -0.2% for the eurozone, a downward revision from estimates although this failed to dent euro exchange rates. The Swiss unemployment rate came in at 4.1% and the service sector for the region came in at a positive 50.9, indicating expansion in the last month.

Australian and New Zealand currency rates have received a boost this week, reaching annual highs against the US dollar after Australia raised interest rates to 3.25%. Australia is the only developed country to have escaped posted growth in the first half of the year and rates are expected to continue to edge their way upwards to 4% from the "emergency" 3% levels.

So it seems we are on a stilted road to recovery, with economic data continuing to show improvement over the summer months. Sterling exchange rates remain the lowest of the major currencies although economists are predicting the pound could correct in future. At present, however UK data remains somewhat volatile, showing the economy is struggling to gain a consistent hold on recovery.

So while volatility is expected to continue, be sure to get yourself registered with Currency Solutions for currency transfer. Out personal currency brokers will monitor the markets on your behalf, ensuring you get the best exchange rates to make the most of your currency transfer. To see how much you could save, phone us on 0207 740 0000 or visit www.currencysolution.com.

Have a good weekend.