British Pound Sterling | Currency News Views and Outlook
- Category: British Pound Sterling
- Published on Tuesday, 05 June 2012 09:44
- Written by Sam Coventry
Ratings firm Egan-Jones on Monday downgraded the U.K.'s rating to AA- from AA.
The pound sterling (Currency:GBP) is looking soft this morning as the UK stays at home for the extended weekend. Nevertheless, currency markets never sleep:
The pound euro exchange rate is 0.29 pct in the blue at 1.2345 at 10:35 BST.
The pound US dollar exchange rate is 0.23 pct lower at 1.5346.
The pound Australian dollar rate is 0.34 pct in the red at 1.5755. (For the latest investment bank FX forecasts please visit our IMT site, access is Free via our Facebook entrance page).
Ratings firm Egan-Jones on Monday downgraded the UKs rating to AA- from AA, citing concerns about the country's debt and banking system.
The firm also put the outlook on the UKs rating at "negative."
The ratings company noted mounting concerns over the risk of financial contagion throughout Europe.
"The major problems for the UK is that Europe's banking crisis does not appear to be abating as evidenced by the miserable results of most [euro-zone] banks," the ratings firm wrote in a report.
Analysts at UBS meanwhile say they are Neutral on the GBP-USD rate.
"The key support of 1.5235 prompted a recovery signalling scope for a correction over the coming days. Resistance is at 1.5439," says a morning note from UBS.
Elsewhere, the Australian dollar got a boost after we got some good news out of China where an important service PMI by HSBC surprisingly showed an increase to a 19 months high, somewhat calming worries about a possible hard landing in the offing for China.