The Great Britain pound soared today, reaching the strongest rate since November 2012 versus the euro, with help of very hawkish comments from Bank of England Governor Mark Carney. The Governor revealed that he considers raising interest rates sooner than the market is anticipating.
Carney was speaking yesterday at the Mansion House Bankers and Merchants Dinner. His speech was very optimistic as the Governor said:
Growth has been much stronger and unemployment has fallen much faster than either we or anyone else expected at last yearâs Mansion House dinner. So far this has been largely matched by indicators which suggest that there is more supply capacity in the labour market than we had previously thought.
As for interest rates, he commented:
Thereâs already great speculation about the exact timing of the first rate hike and this decision is becoming more balanced. It could happen sooner than markets currently expect.
Such optimism was supported by today’s economic data from the United Kingdom. The Conference Board Leading Index rose 0.5 percent in April after rising 0.3 percent in both February and March.
GBP/USD jumped from 1.6927 to 1.6963, reaching the high of 1.6991, and GBP/JPY soared from 172.11 to 172.91 as of 10:18 GMT today, while its daily maximum was at 173.35. EUR/GBP declined from 0.8004 to 0.7996, touching the low of 0.7985.
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