Wednesday 14th September 2011
Good morning. Sterling slipped further against the US Dollar and Euro yesterday, on concerns the UK banks may be exposed to EU debt. Inflation data and BoE comments also weakened Sterling against other currencies, and at 08:30am this morning rates are as follows:
• GBP/EUR 1.1524
• GBP/USD 1.5715
• GBP/AUD 1.5367
• GBP/NZD 1.9194
• GBP/CHF 1.3870
• GBP/CAD 1.5579
• GBP/ZAR 11.606
• GBP/JPY 120.71
• GBP/DKK 8.5833
• GBP/NOK 8.9061
• EUR/USD 1.3627
Sterling falls on inflation data and BoE comments
Inflation data released yesterday failed to squash speculation the Bank of England may opt for more Quantitative Easing. Also weakening Sterling against other currencies were comments from BoE policymaker Adam Posen, who said the central bank should immediately add more monetary stimulus.
More QE would weaken the Pound as it signals worries about how to stimulate growth in the economy. Other data released yesterday showed an unexpected deterioration in the UK's trade deficit to its widest in nearly a year, which again highlights the fragile state of the slow economic recovery.
We also saw further falls against the Euro, as the single currency gained strength on a report that France and Germany would issue a joint statement about Greece.
Unemployment figures are released from the UK today. There has been a run of poor UK data of late and this could compound Sterling weakness. From the Eurozone, we have industrial production figures. Stateside we will see Retail Sales, and various inflationary measures.
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