British Pound Sterling | Currency News Views and Outlook
British Pound Sterling: Currency GBP holds onto solid gains vs EUR; domestic UK data continues to have little impact
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- Category: British Pound Sterling
- Published on Friday, 17 February 2012 10:30
- Written by Will Peters
The Eurozone's dealing with Greece continues to be the driving factor behind moves in the pound exchange rate (Currency:GBP).
(For latest spot pound exchange rates).
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"On Thursday, Greece remained the dominant factor for the EUR/GBP cross rate. Initially, the pair moved more or less in line with EUR/USD and tested the 0.8280 support area. However, the late session rebound was far less pronounced than was the case for EUR/USD," says a morning exchange rate note from KBC Markets.
Currency analysts also point out that the movements in the EUR/USD pair are usually replicated by EUR/GBP.
As equity markets recovered from their lows, so did the euro after briefly dipping below 1.3000.
"The move below the big figure didn’t last all that long before the bulls were back in town adding over one hundred ticks to EUR/USD. The rumour was that the ECB was exchanging Greek bonds for new securities and thus increasing the chances that the bailout will go ahead. This morning EUR/USD is trading at 1.3125 and near term support and resistance are seen at 1.3040, 1.2970 and 1.3190, 1.3215 respectively," says Simon Denham at Capital Spreads.
Elsewhere, the bounce in risk assets was very much to the detriment of the Japanese Yen which gave a boost to USD/JPY allowing the pair to continue its move above the 200 day moving average.
This hasn’t been seen since April last year and so is believed to be quite a significant move. Usually during a move into riskier assets you’d expect the greenback to suffer, but yesterday’s bullish economic data sent the dollar higher against the Yen.
At the time of writing USD/JPY is at 79.10 and near term support and resistance is seen at 78.50, 78.15 and 79.30, 79.50 respectively.
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