Sterling remains steady against euro at 1.13
Today's currency update shows sterling had a steady day yesterday after the Bank of England's meeting minutes were slightly less downbeat than expected.
Today's currency update shows sterling had a steady day yesterday after the Bank of England's meeting minutes were slightly less downbeat than expected.
Currency rates - July 21
EURO/GBP - 1.1336
US$/GBP - 1.6180
CHF/GBP - 1.3267
CAN$/GBP - 1.5306
AUS$/GBP - 1.5066
ZAR/GBP - 11.097
JPY/GBP - 127.55
HKD/GBP - 12.605
NZD/GBP - 1.8850
SEK/GBP - 10.340
US$/EURO - 1.4275
In contrast to last month, only one member discussed the potential need for further Quantitative Easing and members voted 7-2 in favour of keeping rates on hold at 0.5%. Sterling crept up against the US dollar, finishing the day at $1.6123/£1. Investors are still very much concerned over UK exposure to the European sovereign debt crisis, with uncertainty as to what the impact would be in the case of a default.
The euro advanced to the highest level in almost a week against the dollar. European leaders will reach an agreement on the region's debt crisis later today. Some French ministers said that European leaders were less divided than the media was reporting and were likely to reach an agreement at the summit that will alleviate Greece's debt woes. The quiet confidence in the market yesterday helped Italian and Spanish bond yields to fall, having hit record levels on Monday.
In the USA, the US dollar dropped yesterday as risk appetite saw investors unwind safe haven positions and sell US dollars. In addition to confidence over a potential Greek solution today, President Obama and several other Congressional leaders endorsed a new bi-partisan debt ceiling proposal which is aimed at averting default and reducing the deficit in the long run. Markets are feeling slightly happier now the prospect of a US default has all but been averted with this new plan.
Elsewhere, commodity-linked currencies were helped by stronger risk appetite with the Australian dollar making gains against the US dollar. The Canadian dollar reached its highest since early May, helped by a rise in crude oil prices and also interest from a Chinese oil producer in acquiring a Canadian company.
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