Good morning. Unemployment fell yesterday helping boost the pound against the US Dollar. Rates remain steady against the Euro though due to a stronger single currency. Rates as at 08:30am 15th July 2010 are as follows:
- GBP/EUR 1.2004
- GBP/USD 1.5271
- GBP/AUD 1.7423
- GBP/NZD 2.1246
- GBP/CAD 1.5814
- GBP/CHF 1.6090
- GBP/ZAR 11.489
- GBP/NOK 9.5309
- GBP/JPY 134.37
- GBP/HUF 333.70
The number of people unemployed in the UK fell by 34,000 figures showed yesterday. The number of people in work rose by 160,000. However, the increase was due to a record 148,000 rise in the number of part-time workers, while full-time workers increased by just 12,000.
The UK figures will raise hopes that the economic recovery is gaining momentum. Although some experts think unemployment could start rising again by the end of next year. Andrew Sentance, a member of the Bank of England’s Monetary Policy Committee, said in a speech on Tuesday that the labour market had stabilised.
This stabilising market combined with the hint of higher interest rates soon has helped to push Sterling higher against some currencies. Some analysts say though that due to the part time figures being a big part of the increase, figures may show unemployment rising again later this year which could hurt the pound.
Business leaders want Britain to join Euro
Pro-European British business leaders have told the BBC they still think the UK should join the euro in the future. You can read the report on the BBC site here. Sir Bryan Nicholson, chairman of the Financial Reporting Council, said however that “the balance of the argument has now shifted against the UK joining the Euro”.
I think it’s highly unlikely the UK will join the Euro in the next ten years. The flaws of maintaining a single currency between countries with different fiscal policies has been exposed by the recent sovereign debt crises in countries including Greece and Spain. The Euro has been significantly weakened due to this, which has helped GBP/EUR rates climb in May and June.
Estonia joins the Euro
EU finance ministers have given final approval for Estonia to adopt the euro as its currency on 1 January 2011. Meeting in Brussels, they decided to use the existing exchange rate of 15.6466 kroon to one euro as the final conversion rate.
Belgium, Germany, Greece, Spain, France, Ireland, Italy, Luxembourg, the Netherlands, Portugal, Austria and Finland adopted the currency in 2002.
Slovenia joined in 2007, followed by Cyprus and Malta in 2008, and Slovakia in 2009.
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