The pound dollar exchange rate is 0.16 pct higher at 1.6200.
The pound Australian dollar rate is 0.31 pct higher at 1.5357.
10:07: What to look forward to this week
Richard Driver at Caxton FX says we have a busy week ahead for sterling:
"We can look forward to a busy calendar this week for the UK, with plenty of news for the market to get its teeth sunk into before the Christmas break. We should see the UK GDP figure confirmed at 1% on Friday, whilst we expect a slight fall in inflation to be reported tomorrow.
"The main news for the UK will come this Wednesday however, where we will anticipate the release of the MPC minutes. A remarkably quiet calendar today should mean the market gets its direction from the wider issues at play, with the Japanese election, US fiscal cliff, and euro zone still firmly in the spotlight."
9:55: RBS warn safe-haven status unlikely to last through 2013
We have just reported that sterling is benefiting from safe-haven demand this morning.
But, analyst Paul Robson at RBS warns that sterling may not find this support in 2013:
"GBP proved to be a “relative” safe haven from the Euro area crisis in 2012. The currency’s correlation with yields loosened and the Bank of England’s (BoE) continued Quantitative Easing (QE) had less impact on the currency as a result. The rebalancing of the economy has been somewhat slower than expected and the twin fiscal and current account deficits appear to present significant challenges to the currency’s safe haven appeal over coming quarters. While we still see GBP out-performing a very weak EUR and JPY, the currency is expected to under-perform a broader range of currencies in 2013, including the USD."
9:50: GBP in commanding start to new week
The pound sterling (Currency:GBP) is enjoying a great start to the new week. This is courtesy of the UK currency's ability to benefit from safe haven deman; the FTSE 100 and other European markets are all in the red, driving demand for sterling.
A look at the key spot rates we follow shows:
The pound to US dollar exchange rate continues its push higher; GBP/USD is 0.14 pct up at 1.6198.
The pound converts into 1.2315 euro, the rate is 0.2 pct higher.
The pound Australian dollar exchange rate is 0.41 pct up on Friday night's close at 1.5372.