UK pound is heading higher against the euro right now, thanks to the news that Moody’s is planning to review many of the countries in the eurozone. The possibility of downgrades has been floated, and that is impacting the euro in its performance against the pound.
Indeed, the pound has been alternating between gains and losses against the euro for the last little while. News from Great Britain, indicating that home prices rose over the month, is providing a bit of a boost for the pound. The pound relies quite a bit on support from the housing market, and improvement is usually positive. However, housing prices are still down on the year.
The UK pound might run into other problems, though. The Bank of England recently engaged in bond purchases, but that doesn’t seem to be having a big impact on the economy yet. Some are already calling for more quantitative easing to help boost economic growth.
So far, though, Britain’s decision to reject the most recent EU deal on sovereign finances has not had much of an impact on the pound. Some even think that maybe PM David Cameron did the right thing — avoiding what could still turn into a huge eurozone mess.
At 13:06 GMT EUR/GBP is up very slightly at 0.8463, just above the opening level at 0.8462. GBP/USD is higher at 1.5590, up from the open at 1.5584.
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