As a fresh wave of concerns strike the Eurozone the Pound was able to climb to a five-week high against the Euro.
The Pound Sterling Exchange Rate was in the region of 1.1758 against the Euro as of 09:43 am
The British currency, which was bolstered yesterday by a better-than-expected gain in UK retail sales, is now heading for its most significant five-day advance against the Euro for six weeks.
After negotiations with potential Russian rescuers broke down, Cyprus was issued with a stark ultimatum by the European Central Bank.
The island nation has three days in which to agree to a bailout package – or it will receive none of its desperately-required emergency funding.
Yesterday top rating agency Standard and Poor’s slashed Cyprus’ sovereign credit rating from CCC+ with a negative outlook to CCC, and if Cyprus and the ECB fail to reach an agreement within the next 72 hours the nation could also be ejected from the Eurozone.
All this has allowed the Pound to climb to roughly 84.9 pence per Euro, giving Sterling a weekly advance of 1.8 per cent on the common currency.
The Pound continued to trade in the region of the three-week high achieved against the US Dollar yesterday. After briefly hitting 1.5210 US Dollars the Pound slid modestly to 1.5185 US Dollars.
Sterling was able to gain on the ‘Greenback’ after the odds of the Bank of England pushing for additional fiscal stimulus were lowered by yesterday’s UK retail sales report. Although economists had predicted an increase the 2.1 per cent result was significantly higher than the 0.5 per cent gain expected.
Additional movement in the GBP/EUR pairing could be seen today, but whether it moves higher or lower depends on the outcome of the negotiations between Cyprus and the ECB.
Comments are closed.