Sterling rates climb to new highs

In trading Wednesday afternoon, rates for the Euro got close to 1.17, which is the highest level since November last year.

Sterling jumped to its highest level of the year against the euro on Wednesday after positive UK industrial output data helped to reinforce the belief that the economy may be emerging from the worst of the recession.

Sterling’s rise was also partly a result of heavy initial selling of the dollar after Russia announced a plan to cut its share of U.S. Treasuries in its reserves and buy International Monetary Fund bonds.

Some analysts said that sterling gains were capped after Bank of England policymaker Kate Barker said UK interest rates could stay low for some time and that it was still not clear whether the current pick-up in the economy would be sustained. So, it may go higher, or it could tumble as it did last week!

Analysts nevertheless believe the pound will continue to benefit from signs the UK economy is finally emerging from a deep recession, with some pointing to the prospect that the economy could record growth before the end of the year.

So, mid to long term forecasts suggest the pound will continue to rise. However, short term data releases may cause fluctuation to the downside.

Rest of this weeks data:

Thursday
AUS – Employment & Unemployment
EU – ECB Monthly Report
US – Retail Sales
US – Jobless Claims
NZ – Retail Sales

Friday
G8 Meeting
EU – Industrial Production
EU – Trichet Speech
US – Import Prices
EU – Trichet Speech

No Blog Updates for 2 days

Apologies to regular readers and subscribers, however this blog will not be updated tomorrow (Friday) or Monday.

This is due to, errr site maintenance…….. Ok, I’ll be honest – it’s due to me going to Le Mans to watch the 24 hrs race!
Tourist Cash
Despite being a currency trader, I have to source my Euros at tourist rates like everbody else – 1.0950 from the post office today despite being 1.1688 on mid market level.
Ouch.

For some advice though on small Euro cash amounts – bank with Nationwide. In most Euro countries they actually give you interbank rates at ATMs. Best deal out there. If you dont bank with Nationwide, M&S or Post office tend to be ok. Of the other high street banks, HSBC and 1st Direct are at the top end, with Natwest and RBS at the bottom end.
Site updates will continue as normal from Tuesday. In the meantime, please refer to our main site for market updates:

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