Pound Climbs Against Majors; BoE Interest Rate Decision Eyed
The pound rose versus its major counterparts during early European deals on Thursday as traders await the Bank of England’s interest rate decision.
The pound thus recovered from a 2-day low against the yen and bounced back from an Asian session’s loss against the dollar. Against the euro and the pound, the pound strengthened in early European deals after showing choppy trend in Asian session.
The BoE is scheduled to announce its interest rate decision at 7:00 am ET. Analysts predict the bank to keep the rate unchanged at 0.5% and to keep on hold its GBP 200 billion asset purchase programme as they did in February.
The European Central Bank is also due to announce its interest rate decision today at 7:45 am ET. The rate-setting body, led by President Jean-Claude Trichet is widely expected to hold the key interest rate at a record low of 1% for a tenth consecutive month.
House prices in the United Kingdom fell 1.5% month-on-month in February compared to the 0.4% increase in the previous month, Lloyds Banking Group Plc’s Halifax division reported today. This marked the first monthly fall in the Halifax house price indicator in eight months.
House prices spiked 4.5% on a yearly basis in February, accelerating from the 3.6% increase in the preceding month.
The pound, which showed choppy trading against the Swiss franc in Asian deals on Thursday, gained ground in early European session. At 5:00 am ET, the pound rose to 1.6159 against the Swiss currency. As of now, the pound-franc pair is trading at 1.6156, compared to yesterday’s close of 1.6128.
Moving up from a 2-day low of 132.64 hit at 1:40 am ET, the pound rose to 133.44 against the yen at 5:05 am ET. At present, the pound-yen pair is worth 133.40, compared yesterday’s close of 133.57.
Against the U.S. dollar, the pound reached 1.5087 at 5:10 am ET, moving up from a low of 1.5025 touched at 3:00 am ET. The pound-dollar pair that closed yesterday’s trading at 1.5101 is now worth 1.5082.
Moving away from its Asian session’s choppy trend, the pound advanced to 0.9060 against the 16-nation currency during early European deals on Thursday. Currently, the euro-pound pair is quoted at 0.9062. This level may be compared to 0.9074 hit at yesterday’s New York session close.
The preliminary Euro-zone GDP report for the fourth quarter, which was released at 5:00 am ET likely influenced the euro.
From the U.S., the weekly jobless claims report for the week ended February 27 is slated for release at 8:30 am ET. At the same time, the fourth quarter final report on non-farm productivity and unit labor costs are scheduled for release.
Traders will also look forward to the reports on factory goods orders and pending home sales for January – both due at 10:00 am ET.
