Sterling hit a six-week high yesterday against a broadly weaker US dollar after UK GDP figures came in higher than expected.
Sterling hit a six-week high yesterday against a broadly weaker US dollar after UK GDP figures came in higher than expected.
Currency rates & Comments - July 27
EURO/GBP - 1.1318
US$/GBP - 1.6408
CHF/GBP - 1.3128
CAN$/GBP - 1.5495
AUS$/GBP - 1.4858
ZAR/GBP - 10.9632
JPY/GBP - 127.46
HKD/GBP - 12.7858
NZD/GBP - 1.8768
SEK/GBP - 10.2812
US$/EURO - 1.4488
The UK economy grew by a mere 0.2% between April and June as industrial output shrank. However, the consensus expectation was GDP growth of 0.1% and many analysts had been braced for shock figures that showed a contraction. Sterling has benefited from being the 'best of a bad bunch' in recent weeks as markets applaud the UK's austerity measures over the euro zone debt crisis and the deepening US debt crisis.
In the euro zone, the euro jumped against the US dollar, breaking the $1.45/€1 level as markets became concerned over the lack of an agreement over the US debt ceiling. There are concerns that the deadlock will mean that the US government misses a debt repayment next week for the first time in its history.
In the USA, the impasse reached in Washington over the spending cuts and tax increases seems to get harder and harder to break. Essentially, neither the Democrats nor the Republicans are willing to compromise with the other party over their plans to bring down the deficit which seems to rest on the fact that the Republican senators do not want to increase taxes on the wealthy.
Elsewhere, the Swiss franc gained as investors looked to safer haven currencies and in a new twist to current trends, the New Zealand and Australian dollars advanced against the US dollar as Asian sovereign investors looked to diversify away from the US dollar as the reserve currency of choice.
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.