The pound enjoyed a successful day against the single currency yesterday, breaching the 1.1300 level for the first time since the beginning of March as investors’ confidence in sterling continued. Sterling was boosted early in trading as the RICS revealed that UK housing market sentiment improved last month, recovering to its strongest level in 13 months during March. The FTSE 100 continued to simmer below the psychological barrier of 4000, as stock markets were a little quiet ahead of the major announcements coming out of the US this week.
The single currency also came under selling pressure after European Central Bank Governing Council member Axel Weber said a package of non-standard measures was set to be unveiled at next month’s policy meeting that will stretch into next year. The European Central Bank is increasingly being viewed as being behind the curve in regards to its monetary policy, with interest rates set to fall further and a foray into quantitative easing on the cards.
There are no first tier economic announcements due in the UK today, with the eurozone releasing their Consumer Price Index and industrial production data this morning. Expect GBP/EUR to follow equity markets closely in the short term, with JPMorgan releasing their first quarter results in the US later today.
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