Pound Strengthens over Euro debt fear
January 10, 2011 Leave a comment
The pound reached the strongest in 3 months against the euro breaching the 1.20 mark as speculation that the British economy will be more resilient than the euro region in the coming months.
The BOE have predicted the economy will grow by 2% this year which is 0.5% higher than the predicted 1.5% growth expected in the Euro zone.
However the need for additional Stimulus measures may still result in the Pound losing ground against the Euro in the near future. “We’ve got this massive, very open type debate about U.K. interest rates which I think will create volatility for the pound, and we’ve already begun to see that this year,” said Jane Foley, a senior foreign-exchange strategist at Rabobank International in London.
European Central Bank President Jean- Claude Trichet warned governments not to rely on the ECB to get Europe out of its debt crisis and urged them to step up efforts to tighten fiscal rules. Sources have also revealed that the ECB have bought Portuguese government debt today which could be a leading factor in the rise against the Euro last Friday with the low of the day at 1.1869 and a high of 1.2021.
With the pound steadily increasing over the last 2 weeks it is imperative you keep in touch with your Currency Broker. We can keep you updated with news and data releases which may affect your purchase so you can buy or sell at the correct time.
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