Sterling continues rise against euro

The pound strengthened 1.08 cents (0.94%) against the euro yesterday to close the day at 1.1545.

• In early trading yesterday, sterling strengthened against the euro following the news that Standard & Poor’s had downgraded Ireland’s credit rating for the second time in less than three months. The ratings agency cited the fiscal costs to the government of supporting the Irish banking system as the reason for downgrading the country’s rating from AA+ to AA.
  
• Sterling strengthened yesterday despite the results of the European election, which piled further pressure on Prime Minister Gordon Brown after Labour endured a humiliating defeat.
  
• In trading so far today, sterling has strengthened against the euro following the news that Gordon Brown’s leadership will not be imminently challenged. He met with the Parliamentary Labour Party last night and appears to have diffused his critics, for now.
  
• There are no major announcements due in the UK today, whilst in the eurozone, German industrial production figures are out at 11.00 BST.