A fresh opinion poll on the Scottish bid for independence has seen the no vote regain the lead and the Pound Sterling has strengthened a little as a result. European data printed positively on Thursday but not strong enough to overshadow continued concerns over the European Central Bank’s loose stance on monetary policy.
The Pound Sterling to Euro exchange rate is currently trending in the region of 1.2563.
Sterling has been the victim of increasing negative sentiment after the Scottish bid for independence proved to be more likely than first anticipated. The most recent YouGov poll, which indicated a Nationalist lead of 51%, sent shivers down trader spines as a divided Britain could spell disaster for the Pound.
Meanwhile the single currency hasn’t fared much better than Sterling as trader reaction to the ECB’s rate cuts and stimulus initiative continues to have a detrimental effect on the Euro. With the Scottish referendum dominating trader focus the Euro has had very little by way of foreign investment, especially from the UK.
The Pound Sterling to Euro exchange rate has hit a low today of 1.2534.
The Survation poll for the Daily Record has indicated that those opposed to an independent Scotland have once again taken the lead at 53%. The Survation poll was carried out between the 5th and 9th of September which is the period after the YouGov poll which indicated that the yes vote was leading by 51%. It is widely acknowledged that Survation favours the nationalist vote so its latest findings will be of comfort to the unionists.
A solitary British economic data publication on Thursday printed relatively negatively, but the poor result was not enough to micrify the pleasing findings from the Survation poll. The RICS House Price Balance was expected to print at 47% but the actual data was a disappointing declination to just 40%.
European data has been relatively positive on Thursday but the Euro is still struggling to throw off the shackles of a desperately low 0.05% benchmark interest rate. The EU-Harmonised German Consumer Price Index met with the forecast figure of 0.8% as did the German Consumer Price Index.
On Thursday the European Central Bank published its monthly report. In the main the report emulated the press conference following the ECB’s decision to loosen their monetary policy. The report stated; ‘The Governing Council, taking into account the measures decided on 4 September, will continue to closely monitor the risks to the outlook for price developments over the medium term.’ The report also stated; ‘Should it become necessary to further address risks of too prolonged a period of low inflation, the Governing Council is unanimous in its commitment to using additional unconventional instruments within its mandate’.
