Pound Sterling to US Dollar (GBP/USD) Exchange Rate – Sterling pushes higher as IMF raises UK forecast

The Pound shrugged off earlier data which showed that business optimism fell in January as the International Monetary Fund revealed that it has hiked its growth forecast for the UK economy.

Against the US Dollar, Euro and other major peers the Sterling strengthened after the IMF said that it now expects the UK to become the fastest growing economy in Europe after it increased its growth forecast from 1.9% to 2.4% for 2014.

The IMF’s revised figure is now in line with the one set by the UK Office for Budget Responsibility. The IMF upgraded its forecast for the UK in 2014 by more than for any other economy. It also raised its forecast for growth in 2015 to 2.2%.

“The IMF report provides further evidence that the government’s long term economic plan is working, but the job is not yet done and so the government will go on taking the difficult decisions necessary to deliver a sustainable recovery for all”, said a spokesman for the UK Treasury.

A strong run of positive economic data releases and rising confidence in the economy has seen the Pound soar in recent months to multi-year highs against a number of peers such as the Australian and Canadian Dollars.

The US Dollar managed to limit losses against the Pound after the currency remained supported by expectations that the Federal Reserve will continue reducing its quantitative easing programme when it meets for its next policy meeting at the end of the month.