Sterling closes at year-high against euro

Sterling hit a year-high against the euro yesterday, rising 0.94 cents (0.80%) to close the day at 1.1823.

• In early trading yesterday, sterling continued its rally against the single currency after weak eurozone employment figures prompted investors to question the health of the region’s economy. The region lost 1.22 million jobs during the first three months of 2009.
  
• An upbeat report released by the Confederation of British Industry also bolstered demand for the pound yesterday, after it predicted the UK economy would stabilise in the fourth quarter of the year, earlier than previous estimates, and that growth would return in early 2010.
  
• In trading so far today, sterling has pared some of yesterday’s gains as investors eye important data out later today.
  
• In the UK, CPI inflation figures are out at 09.30 BST today, whilst in the eurozone, German ZEW Economic Sentiment data and inflation figures are due at 10.00 BST.