British pound sterling: Currency up vs EUR, GBP, AUD and NZD as investors see BoE as being ahead of the curve on monetary easing
- Details
- Category: Exchange Rates
- Published on Friday, 22 June 2012 09:35
- Written by Will Peters
"With bad global news coming from all angles, the UK economy actually had a good news story from the retail sector" - Caxton FX.
The pound sterling (Currency:GBP) appears to have accounted for expectations of another bout of quantitative easing in within the next few months. (For the latest FX forecasts please visit our IMT site, access is Free via this Facebook path).
Indeed, it would appear that investors are actually bidding up sterling with the view that the Bank of England is in fact ahead of the curve when it comes to easing monetary supply to shore up the economy.
Vs Australian Dollar
The pound Australian dollar exchange rate is 0.36 pct higher at 1.5588.
Sterling is back where it started the week against the Australian dollar (Currency:AUD) amid sliding global confidence.
Rumours of a coordinated move between global central banks had raised hopes of QE3 from the Fed but this support was not forthcoming.
Equities slid yesterday and overnight, while commodity prices also posted losses, which all weighed on the Australian dollar.
"With bad global news coming from all angles, the UK economy actually had a good news story from the retail sector, which helped GBP/AUD climb to the current level of 1.5575," says a morning note from FX firm Caxton FX.
Vs Euro
The pound vs euro is 0.15 pct higher on yesterday's close at 1.2453.
The pound is preferred to the euro in line with the risk inherent in the Eurozone.
Data from the UK and Europe is light on the ground today. But, there will be focus placed on headlines out of the ongoing Eurogroup finance minister’s meeting and also speculation is expected to continue surrounding the use of EFSF/ESM funds to purchase peripheral bonds as German Chancellor Merkel meets Italian Prime Minister Monti and French President Hollande in Rome.
Vs New Zealand Dollar
The pound to New Zealand dollar is 0.15 pct up on Thursday's close at 1.9863.
Sterling rallied yesterday to erase this week’s losses as the New Zealand dollar (Currency:NZD) failed to sustain its GDP-related gains.
The rally we have seen in global stocks this week has certainly run out of steam amid a raft of poor economic data from the US, the eurozone and China.
"Factor in the Fed has chosen not to pull the trigger on QE3, which would have eased market concerns considerably, it is no surprise to see the NZD give back some of its recent gains.
"Sterling is trading up towards 1.99 this morning and we may see some further risk aversion to drive this pair higher still," says Driver.
Vs US dollar
The pound to US dollar exchange rate is 0.21 pct higher at 1.5625.
The pound lost further ground to the dollar yesterday in line with falling global markets.
This morning however the pound seems to be staging a relief rally.
There is also the theme, presented at the top of this article, that investors could be seeing the Bank of England as being more proactive than its global counterparts.
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