Pound Strengthens vs. Franc on King’s Statement

The Great Britain pound rose today against the Swiss franc as the optimistic statement of the central bank’s governor Mervyn King improved the confidence in Britain’s currency. Against other currencies the pound was rather flat as the markets traded slower than usual today because of the Thanksgiving holiday in the US.
The Bank of England Governor Mervyn King said in his statement to the Treasury Select Committee of the House of Commons this morning:

Together with policymakers overseas, the Monetary Policy Committee responded quickly to the financial crisis — cutting Bank Rate almost to zero, and injecting additional money into the economy through our asset purchase programme. This unprecedented response did stop the fall in output in 2009, and over the past year has generated the beginnings of a recovery. Output has grown by a little more than its long-run average, and close to the centre of the projection made by the MPC a year ago.

He also said that “a majority of the MPC have concluded that the risks are, at present, broadly balanced”. The optimistic statement boosted the sterling against the franc, but hasn’t managed to drive the pound higher against other majors.
GBP/CHF rose from 1.5705 to 1.57769 as of 14:48 GMT today. GBP/USD traded near it opening level of 1.5770.

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