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Sterling fell to seven-month low on Friday

Published:  25 October, 2010

Sterling fell to a seven-month low against the euro on Friday after sterling stayed on the back foot after Bank of England suggested that the UK economy might be in store for further Quantitative Easing.

Sterling fell to a seven-month low against the euro on Friday after sterling stayed on the back foot after Bank of England minutes earlier in the week suggested that the UK economy might be in store for further Quantitative Easing.


Currency Rates
EURO/GBP - 1.120
US$/GBP - 1.573
CHF/GBP - 1.525
CAN$/GBP - 1.602
AUS$/GBP - 1.578
ZAR/GBP - 10.830
JPY/GBP - 126.67
HKD/GBP - 12.210
NZD/GBP - 2.086
US$/EURO - 1.404
HUF/GBP - 306.96



In early trading today, sterling has dropped even further against the euro, hitting a low of €1.1184/£1 as financial markets begin to price in the possibility of further money being pumped into the economy. Data is fairly thin on the ground in the UK, with mortgage approval data later on today and Bank of England member Paul Tucker speaking at lunchtime. Ahead of next week's monthly Monetary Policy Meeting, there are several members of the committee speaking publicly this week and their comments will be watched closely.


In the Euro zone, the single currency is so far trading up 0.4% this morning as investors back the euro over the ever weakening US dollar and sterling. The euro is benefiting after a key European policy maker made comments that the European Central bank would seek to scale back on the amount of monetary assistance - in sharp contrast to the USA and UK where the relevant bodies have been discussing adding more money to the respective economies. There is industrial order data for Europe released today which is expected to show an improvement on last month.

In the USA, the US dollar weakened across the board in early trading as G20 leaders agreed to avoid competitive currency devaluation and sparking a 'currency war' between nations desperate to increase the flow of money into their economies by manipulating the exchange rate. This saw most Asian currencies strengthen as investors speculated that these currencies would see a jump in value after being kept artificially low against the US dollar for a number of years.

Elsewhere, the Australian dollar surged by nearly 1.3% against the US dollar on the news that Singapore exchange will buy the Australian stock exchange. In addition, a surprise jump in producer prices spurred speculation that the Reserve Bank of Australia would raise interest rates in their next meeting.


Smart Currency Exchange is a currency partner to Harpers Wine and Spirit. Harpers Wine and Spirit has teamed up with Smart to provide readers with a free bespoke currency service.



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