Sterling Makes Slight Gains Despite Inflation Figures
19 September, 2012
Yesterday the Pound made gains across the board despite being unmoved following the release of inflation figures. The yearly rate fell to 2.5% from 2.6% in July broadly in line with market expectations, giving little for the pound to work with. Investors sought to take profits against the Euro as concerns over Spain regarding whether they will ask for a bailout or not grew coupled with the German ZEW consumer confidence survey which posted a lower figure than hoped raising concerns about Europe largest economy. The gains for sterling were limited and the pair are still trading well below the peaks we saw only last month.
Against the US dollar the gains were more limited with little to go on, the pound made a small gain over the day against a broadly weak dollar, so for those looking to move money to the States, whether for business or pleasure you are trading at 4 ½ month highs. For those companies out there who deal with US dollar transfers, whether it’s to the States or the Far East, it could be wise to take advantage and speak to one of the brokers at Currency Index about forward buying time options, which allow you to secure a rate on a lump sum of dollars which can be then drawn down in smaller chunks as those invoices require settling – call today to discuss the details.
The drop in inflation has kept alive the view the Bank of England could introduce further QE so gains for the pound are likely to remain slim. With recent data being upbeat it’s a complete guessing game as to what the BoE will do so future releases will give a better idea, most notably the upcoming BoE minutes from the recent meeting, released this morning at 9.30am. Any hint will almost certainly knock the pound so keep in touch if you have a requirement coming up.
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