Pound Firm Ahead Of Q4 U.K. GDP Data
27 January 2015 - 7:04PM
RTTF2
The British pound strengthened against the other major
currencies in the Asian session on Tuesday, as traders eye fourth
quarter U.K. GDP data due shortly.
Comments from Bank of England policymaker Kristin Forbes on
Monday that the robust growth in the U.S. and cheaper oil could
benefit consumption and investment growth, which will strengthen
the case for raising the interest rate from a record low 0.50
percent, earlier than expected.
The U.K. central bank is widely expected to raise interest rates
by the middle of 2016.
Forbes also said that the economy may respond in unexpected ways
even as the BoE's exit strategy involves raising rates slowly and
incrementally. When the change comes, policymakers will be careful
in communicating it and consider the risks, she added.
Traders also await the release of preliminary fourth quarter
U.K. GDP data due at 4:30 am ET. The economy is forecast to expand
0.6 percent sequentially,slower than the 0.7 percent rise in the
previous quarter. Annually, GDP is expected to grow 2.8 percent
after the 2.6 percent increase in the previous quarter.
Meanwhile, Asian stocks traded higher following the
parliamentary elections in Greece over the weekend. The leftist
Syriza party joined hands with the Greek Independents to form an
anti-bailout coalition government. While Greek Prime Minister-elect
Alexis Tsipras has a mandate to rework the terms of a 240-billion
euros bailout program, market participants seem to believe that
Greece is less inclined to exit the euro zone.
Monday, the pound rose 0.34 percent against the euro, 0.44
percent against the U.S. dollar, 0.23 percent against the yen and
3.10 percent against the Swiss franc.
In the Asian trading today, the pound rose to 5-day highs of
1.5114 against the U.S. dollar and 179.02 against the yen, from
yesterday's closing quotes of 1.5056 and 178.58, respectively. If
the pound extends its uptrend, it is likely to find resistance
around 1.53 against the greenback and 181.18 against the yen.
Against the euro, the pound edged up to 0.7434 from an early low
of 0.7457. The pound is likely to find resistance around the 0.73
area.
The pound, which ended yesterday's deals at 1.3610 against the
Swiss franc, strengthened to nearly a 2-week high of 1.3668. On the
upside, 1.56 is seen as the next resistance level for the pound.
Looking ahead, U.S. durable goods order and home sales for
December, U.S. S&P/ Case-Shiller home price index for November,
U.S. Richmond manufacturing index, Markit's U.S. flash services PMI
for January and the Conference Board's consumer confidence index,
also for January are due to be released in New York session.
Euro vs Sterling (FX:EURGBP)
Forex Chart
From Mar 2024 to Apr 2024
Euro vs Sterling (FX:EURGBP)
Forex Chart
From Apr 2023 to Apr 2024