The pound is higher against the euro as speculation that Greece will require a restructuring of its debt continue to weight on the single currency. The cost of insuring Greek government debt rose to record yesterday, with increasing probabilities for the country to default within next five years. On the other hand, sterling managed to pare its recent loses against the dollar after rating agency Standard & Poor’s (S&P) cut its outlook on US triple-A rating of sovereign debt to negative. Recent sterling drops versus the dollar were driven by lower than expected reading of UK inflation last week, which prompted investors to pull back its bets on BoE’s immediate interest rates hike. Looking ahead to this week, the Bank of England will release the Minutes from its latest meeting on Wednesday, and traders will pay close attention for any clues regarding the future interest rate rise. Expect for the pound to remain in current levels against the major rivals should we see more dovish stance from latest Monetary Policy Committee meeting.
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19/04/2011
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at current level the dollar decline could stop or increase its declines. Would be careful here.
Posted by: Intrinsic Value | 22/04/2011 at 06:00 AM