The Great Britain pound fluctuated against the safer currencies on the concerns about the stalling nation’s economy. The sterling performed better against the dollar and the yen, while was struggling against the franc.
The fundamentals were mixed for the economy and the currency of the United Kingdom. On one hand, the UK trade balance deficit shrank to £2.0 billion in the second quarter down from £4.1 billion in the first quarter, while analysts expected it reach £9.7 billion. On the other hand, the number of the mortgage approvals for house purchase decreased to 33,130 in September from 35,069 in August, according to British Bankers’ Association, while an increase to 36,300 was expected.
Bank of England Governor Mervyn King was speaking yesterday before the UK Parliament’s Treasury Committee. He mentioned the problems of the world economy:
Growth has disappointed, both here and abroad. Business and consumer confidence have fallen sharply, not only at home but also elsewhere in Europe and the United States. And the level of world trade in goods has stagnated.
The Governor also outlined the impact of these problems on Britain’s economy and other issues. But at the end he softened the negativity, saying “We can be optimistic â the fundamentals of the UK economy are strong”.
GBP/USD rose from 1.5998 to 1.6016 today as of 00:58 GMT. GBP/JPY was at 121.81. slightly above the opening rate of 121.71. Both currency pairs was almost unchanged yesterday. GBP/CHF went from 1.4042 to 1.4063, following yesterday’s drop from 1.4087 to 1.4043.
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