Prior to the release of industrial production data for the UK the Pound was holding steady against both the US Dollar and Euro, having largely retained gains recorded yesterday in response to surprisingly strong UK services PMI data.
The Pound Sterling to Euro Exchange Rate was in the region of 1.1582 as of 10:40 GMT
1 Euro is currently worth 0.8654 pence
As the European session progressed Sterling was boosted by additional positive UK news.
The British currency advanced on its peers as UK home prices were shown to have surged at their most rapid annual pace for almost three years in July, climbing by 0.9 per cent month-on-month.
In a statement issued with the housing data Halifax economist Martin Ellis asserted: ‘Signs of improvement in the economy […] appear to have boosted consumer confidence. House prices are expected to continue to rise gradually through this year, with only modest economic growth and still falling real earnings constraining housing demand and activity.’
Soon after this report was released UK manufacturing/industrial production figures were published, and they too trumped estimates.
After three months of stagnation, UK industrial production advanced by 1.1 per cent in May (month-on-month) – significantly better than the 0.7 per cent increase expected.
Manufacturing production climbed by 1.9 per cent MoM instead of the 1.0 per cent forecast.
The result prompted this response from economist Howard Archer: ‘Manufacturers will be hoping that the recent improvement in UK economic activity is sustained. The Bank of England may well observe that while the economy has recently gained encouraging traction, the growth outlook is still fragile.’
The GBP/EUR exchange rate hit a high of 1.1622
The Pound was able to extend gains against the US Dollar following the news, and consolidate its advance against the Euro.
Additional Sterling movement could occur as the day progresses and the July NIESR GDP estimate for the UK is released.
Investors will also be looking ahead to tomorrow, and the Bank of England’s inflation report. It is expected that the report will outline plans for interest rate forward guidance.
Current Pound Sterling (GBP) Exchange Rates:
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The Pound Sterling/US Dollar Exchange Rate is currently in the region of: 1.5376 >
The Pound Sterling/Euro Exchange Rate is currently in the region of: 1.1582 >
The Pound Sterling/Australian Dollar Exchange Rate is currently in the region of: 1.7094 <
The Pound Sterling/New Zealand Dollar Exchange Rate is currently in the region of: 1.9526 <
The US Dollar/Pound Sterling Exchange Rate is currently in the region of: 0.6507 <
The Euro/Pound Sterling Exchange Rate is currently in the region of: 0.8632 <
The Australian Dollar/Pound Sterling Exchange Rate is currently in the region of: 0.5843 >
The New Zealand Dollar/Pound Sterling Exchange Rate is currently in the region of: 0.5121 >
(As of 10:40 GMT)
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