In a quiet day of trading before the long weekend, the pound lost some value against the single currency as investors were wary of taking on too much risk. The pound was little changed after the widely anticipated decision by the Bank of England to keep interest rates on hold at 0.5%. The announcement contained no surprises and the central bank will continue with its quantitative easing programme. Early in trading, sterling was helped to a day high against the euro after it was confirmed that Barclays was selling its iShares asset management business for over £3bn, boosting their balance sheet.
In early trading today the pound is gaining value against the euro, as equity markets are continuing to be boosted by better than expected results released by the American banks Wells Fargo and Goldman Sachs. Both banks have revealed first quarter profits ahead of expectations, boosting risk appetite which in turn is benefiting the higher risk pound.
There are no major economic announcements due in the UK or the eurozone this morning, so expect GBP / EUR to take further direction from the movement in equity markets today.
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