Sterling starts the week on the up
- Posted by currencies in Bank of England, Bremain, Brexit, Currency, Dollar, Economy, EUR, GBP, Sterling, UK, Uncategorised
- April 9, 2018
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Sterling rose against the euro and dollar this morning and is on track for a third consecutive day of gains as investors are encouraged by data showing British house prices rising more than expected in March.
Since Britain signed a transition agreement last month to cover the 21-month period after it leaves the European Union, concerns about Brexit have abated as investors focus on the state of the UK economy before an expected interest rate rise in May.
Mortgage lender Halifax said that house prices rose by a stronger-than-expected 2.7 percent in the first three months of 2018.
The data is likely to bolster expectations that the Bank of England will raise rates next month by a quarter percentage point and reduce fears among investors that Britain’s economy is too weak to stomach a second hike later in 2018.
However, house prices are still rising much more slowly than before the 2016 referendum decision to take Britain out of the European Union which hit confidence among many households as the pound’s fall pushed up inflation.
After last week’s Eurozone data failed to give investors much reason to buy the Euro and global trade uncertainties weighed on Eurozone markets, GBP to EUR exchange rate spent most of the week rising.
The has remained appealing on Brexit speculation and Bank of England interest rate hike bets, helping it to easily gain against a Euro weakened by underwhelming domestic data.
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