Although the US Dollar derived support from pro-tapering comments issued by Fed official James Bullard yesterday, the Pound was still able to rally to an over two-year high against its North American counterpart.
The Pound Sterling to Euro Exchange Rate was in the region of 1.1956 as of 10:30 GMT
Yesterday Bank of England Governor Mark Carney stressed that the policy deployed by the central bank had effectively bolstered the UK economic recovery, but went on to say; ‘I feel pretty comfortably about the near-term outlook. But the longer-term outlook is going to turn on these bigger questions of business investment, what happens to productivity, what happens to the so-called supply side of our economy’.
However, despite these moderately pessimistic remarks Sterling was supported overnight as UK house prices were shown to have climbed to an over ten-year high in November.
The Pound also edged higher against several of its other main peers as the Royal Institution of Chartered Surveyors’ house-price index advanced from 57 to 58. While this was slightly below estimates for an increase to 60 it was still the strongest reading since 2002.
According to currency strategist Jeremy Stretch; ‘Sterling looks likely to continue to grind higher against the Dollar, even if the Dollar looks a little oversold. People will be continuing to talk about a break or a test of $1.65 in the short term, even though we’ve only just broken through $1.64’.
1 Euro is currently worth 0.8364 pence
The Pound was little changed against the Euro ahead of the release of UK industrial/manufacturing production reports.
The output data showed that industrial production increased for a second month in October, rising 0.4 per cent month-on-month, as expected by economists.
Manufacturing production also climbed by 0.4 per cent on a monthly basis.
Separate figures revealed that the UK’s goods trade deficit narrowed from a revised 10.1 billion Pounds to 9.73 billion Pounds in October.
Exports fell by 1.3 per cent while imports tumbled 1.9 per cent.
As exports to the European Union fell by 3.8 per cent the UK’s 6.5 billion Pound deficit with the region is now a record high.
Pound gains against the Euro were also prevented as the common currency strengthened in the wake of French output figures and better than originally estimated Italian growth data.
While previous figures had Italy’s economy contracting by 0.1 per cent in the third quarter it actually stagnated.
Further GBP/EUR movement could be occasioned later today as the NIESR UK GDP estimate is published.
Signs that the UK’s economic recovery is continuing to gather pace are likely to keep the Pound buoyed.
Current Pound Sterling (GBP) Exchange Rates:
< Down > Up
The Pound Sterling/US Dollar Exchange Rate is currently in the region of: 1.6433 >
The Pound Sterling/Euro Exchange Rate is currently in the region of: 1.1956 <
The Pound Sterling/Australian Dollar Exchange Rate is currently in the region of: 1.8047 >
The Pound Sterling/New Zealand Dollar Exchange Rate is currently in the region of: 1.9842 <
The US Dollar/Pound Sterling Exchange Rate is currently in the region of: 0.6084 <
The Euro/Pound Sterling Exchange Rate is currently in the region of: 0.8364 >
The Australian Dollar/Pound Sterling Exchange Rate is currently in the region of: 0.5526 <
The New Zealand Dollar/Pound Sterling Exchange Rate is currently in the region of: 0.5043 >
(As of 10:30 GMT)
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