The latest economic data out of Britain is disappointing, showing a wider budget deficit than expected. However, even with this disappointing news, the pound is still performing better than the euro today.
Pound is mixed today, falling against the US dollar and the Japanese yen as risk appetite flees, and as bad news in Britain puts the pound in a difficult position. However, even with the bad news, the UK pound is still doing better than the euro, which is tanking on the news that Valencia is requesting rescue funds from the Spanish government and driving up yields.
In Britain, the widening budget deficit is causing concern about the expected economic growth. George Osborne, the Chancellor of the Exchequer, came in with lofty goals to get British finances back on track, but this latest report is likely to disappoint — and underscore his difficulty in accomplishing a better economy through austerity.
For now, the pound remains mixed. There is speculation about what Britain will do next to help stimulate the economy.
At 15:56 GMT, EUR/GBP is lower at 0.7790, down from the open at 0.7809. GBP/USD is down to 1.5629 from the open at 1.5726. GBP/JPY is also lower, down to 122.6660 from the open at 123.5850.
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