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Consumer Confidence Support Sterling’s Advance

March 3, 2010 at 16:28 by Jan Baros

Great Britain poundThe U.K. currency entered its second day of gains versus most of the main traded currencies after evidences of economic improvements started to appear in the country, increasing appetite for assets in the country, which have been lately affected by grim forecasts towards the kingdom’s economy.

Two positive economic releases helped the pound to beat multiple currencies this week so far after an index of services industries rose to the highest levels since the global slump struck the U.K.’s economy, and a consumer confidence report came with numbers much above forecasts, signaling that despite the country’s budget deficit is rising, the economic dynamism in the country may allow the government to cope more easily what the current financial challenges in the country.

The pound had a sharp drop in the past weeks, specially after Britain’s budget deficit started to raise concerns among traders, and now, as positive events came up, the market may be considering that the country’s losing streak was partially speculative. Despite the pound’s advance today, the general picture in the country is still pessimism, and further drops may follow.

GBP/USD traded at 1.5051 as of 14:22 GMT from a previous intraday rate of 1.4924. GBP/JPY traded at 133.47 from 132.76.

If you have any questions, comments, or opinions regarding the Great Britain Pound, feel free to post them using the commentary form below.

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