In response to the Bank of England’s decision to cut interest rates by 0.5% to a new historic low of 1% yesterday, the pound has regained value against the single currency as markets reacted positively to the move. The European Central Bank also acted as expected and kept interest rates on hold at 2%. Housing numbers from the Halifax house price index also surprised to the upside earlier on Thursday, with a rise in prices of 1.9 percent in January, with many anticipating they would have fallen further. In early trading today the pound has risen further against the euro, hitting a 2 month high as investors hold on to the belief that the UK’s interest rates may be nearing the bottom, whereas the eurozone has much further to fall. It must be noted, however, that an underlying nervousness still remains over the state of the UK’s economy and how deep a recession we may be facing.
Germany release their industrial production figures this morning, whilst within the UK, industrial and manufacturing data is released.
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