A variety of factors helped the Pound rally against its European counterpart during local trading and pushed the British currency to an eight-month high against its US rival.
The Pound Sterling to Euro Exchange Rate was in the region of 1.1900 as of 10:50 GMT.
Sterling broadly strengthened after the GfK consumer confidence index for the UK jumped from -13 in August to -10 in September, an almost six-month high and a better improvement than economists were expecting.
The Pound also benefited from a report showing that British house prices increased at the most rapid annual pace for over three years this month. Figures compiled by Nationwide building society showed that the annual rate of house price growth leapt from 3.5 per cent to 5.0 per cent. Although the result does tie in with other data showing improvement in the UK’s economic recovery, it also prompted concern from economists that the Bank of England’s lending schemes may be working too well.
But despite housing-bubble fears, with Bank of England Governor Mark Carney asserting that he sees no call for extending stimulus, the Pound was able to consolidate gains against almost all of its most traded peers.
During an interview for the Yorkshire post Carney stated that while the BoE would consider increasing stimulus if the UK economy began to struggle, ‘my personal view is, given that the recovery has strengthened and broadened, I don’t see a cause for quantitative easing and I have not supported it.’
1 Euro is currently worth 0.8403 pence
Carney’s bold statement, and the Pound’s consequent movement, prompted this response from currency strategist Jane Foley; ‘This sits with the tone we’ve seen recently from the Bank of England, where there was an absence of very dovish rhetoric. The message is that there may be further asset purchases should the recovery stall, but the data suggest that things are returning to normal. The market has quashed most of its hopes that there could be more QE.’
However, with several gauges of confidence for the Eurozone beating estimates, the Euro was able to recover some ground ahead of the publication of German inflation figures.
The GBP/USD pairing could also experience further movement before the weekend as a result of US personal consumption data and the final reading of the University of Michigan index.
UK data to watch out for next week includes; Net consumer credit, mortgage approvals, manufacturing PMI, construction PMI, Services PMI and the Lloyds employment confidence index.
Current Pound Sterling (GBP) Exchange Rates:
< Down > Up
The Pound Sterling/US Dollar Exchange Rate is currently in the region of: 1.6035 <
The Pound Sterling/Euro Exchange Rate is currently in the region of: 1.1900 >
The Pound Sterling/Australian Dollar Exchange Rate is currently in the region of: 1.7240 >
The Pound Sterling/New Zealand Dollar Exchange Rate is currently in the region of: 1.9395 >
The US Dollar/Pound Sterling Exchange Rate is currently in the region of: 0.6222 <
The Euro/Pound Sterling Exchange Rate is currently in the region of: 0.8403 <
The Australian Dollar/Pound Sterling Exchange Rate is currently in the region of: 0.5805 <
The New Zealand Dollar/Pound Sterling Exchange Rate is currently in the region of: 0.5157 <
(As of 10:50 GMT)
Comments are closed.