The Great Britain pound climbed to the highest level in almost two years against the euro today as better-than-expected macroeconomic data from the United Kingdom was a stark contrast to negative fundamentals in Europe. The currency was flat against the Japanese yen and fell against the US dollar.
The UK construction Purchasing Managers’ Index slipped from 56.7 in March to 55.8 in April. Analysts predicted a drop to 54.1. The index is still close to the March 21-month high and well above the neutral level of 50.0, indicating robust growth. At the same time, reports from Europe left little room to optimism, driving investors away from the euro to the relative safety of the pound.
The Bank of England will hold a monetary policy meeting next week and will announce its policy decision on May 10. Most experts say that the central bank may expand its asset purchase program. That does not bode well for the sterling.
EUR/GBP was down from 0.8159 to 0.8118 as of 21:47 GMT today, while the intraday low was the lowest since June 30 2010. GBP/USD slid from 1.6216 to 1.6197. GBP/JPY was near 129.76 after jumping from 129.88 to 130.75.
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