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Pound Close To Two-Year High (GBP/USD)
Published: 23 Dec at 4 PM Tags: Pound Sterling, Euro Exchange Rate, Dollar Exchange Rate, Currency Exchange, Forex, Euro Crisis, UK,
Last week’s encouraging UK employment and retail sales figures boosted the Pound against its peers and helped the currency rally against rivals like the US Dollar and Euro.
But Sterling stumbled on Friday as although growth data impressed, public finance figures were found wanting.
However, over the weekend the Pound found its footing again and began the European session close to a two-year high against the US Dollar.
After the Federal Open Market Committee surprised markets by opting to taper stimulus by $10 billion Dollars the ‘Greenback’ enjoyed a widespread rally. But with trading quietening down before the Christmas holiday the US Dollar lost momentum and currencies like the Pound were able to advance.
The Pound was also supported by comments issued by Bank of England official Andrew Bailey. During an interview for the telegraph the Deputy BoE Governor intimated that the central bank was willing to take action if UK house prices continued to accelerate more rapidly than expected.
While Business Secretary Vince Cable has spoken of the dangers posed by the BoE Help to Buy housing scheme, the central bank hasn’t appeared unduly concerned by the rate at which house prices are rising, but has tapered the programme in order to limit any further price surges.
According to one London-based industry expert, the BoE ‘will want to have a better idea of the impact of Help to Buy before committing to additional steps within the housing market. With the unemployment rate edging ever closer to 7 per cent, it seems that everything is moving along as planned. Governor Mark Carney’s next steps will be closely monitored by the markets.’
Sterling was little-changed against the Euro having enjoyed its strongest five-day performance against the common currency for six weeks.
Although tomorrow’s UK BBA loans for house purchase figures could inspire some Pound movement before the Christmas festivities kick off, with the holiday season upon us and data releases limited, currencies like the Pound may be trading in a fairly narrow range in the days ahead.
But Sterling stumbled on Friday as although growth data impressed, public finance figures were found wanting.
However, over the weekend the Pound found its footing again and began the European session close to a two-year high against the US Dollar.
After the Federal Open Market Committee surprised markets by opting to taper stimulus by $10 billion Dollars the ‘Greenback’ enjoyed a widespread rally. But with trading quietening down before the Christmas holiday the US Dollar lost momentum and currencies like the Pound were able to advance.
The Pound was also supported by comments issued by Bank of England official Andrew Bailey. During an interview for the telegraph the Deputy BoE Governor intimated that the central bank was willing to take action if UK house prices continued to accelerate more rapidly than expected.
While Business Secretary Vince Cable has spoken of the dangers posed by the BoE Help to Buy housing scheme, the central bank hasn’t appeared unduly concerned by the rate at which house prices are rising, but has tapered the programme in order to limit any further price surges.
According to one London-based industry expert, the BoE ‘will want to have a better idea of the impact of Help to Buy before committing to additional steps within the housing market. With the unemployment rate edging ever closer to 7 per cent, it seems that everything is moving along as planned. Governor Mark Carney’s next steps will be closely monitored by the markets.’
Sterling was little-changed against the Euro having enjoyed its strongest five-day performance against the common currency for six weeks.
Although tomorrow’s UK BBA loans for house purchase figures could inspire some Pound movement before the Christmas festivities kick off, with the holiday season upon us and data releases limited, currencies like the Pound may be trading in a fairly narrow range in the days ahead.
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Source: moneytransfer.co.uk