Pound Strengthens Further ahead of Carney’s Speech


Pound Strengthens Further ahead of Carney’s SpeechThe pound extended its gains versus the euro for the fifth day as Bank of England Governor Mark Carney prepares to speak this week amid speculation of U.K. interest rate increases.

The sterling jumped 0.3 percent to trade at 78.54 pence per euro as of 4:25 p.m. in London after earlier advancing to 78.10 pence on Sept. 19, its highest level since July 2012. The sterling jumped 0.3 percent to steady at $1.6333.

“Against a range of currencies, sterling still seems to be pretty firm and deservedly so given where the U.K. is in the monetary cycle,” Steve Barrow, a London-based head of Group-of-10 strategy of Standard Bank Plc, was quoted by Bloomberg News as saying. “Whilst my general view is more bullish than bearish, the pound moved up some distance before the referendum so there might be a degree of profit taking and it might be something that’s encouraged if the economic data is underwhelming.”

The pound had earlier rose after Scots voted to remain part of the U.K. on Sept. 18, halting talk about whether Scotland will continue using the currency if it had broken away.

Carney is expected to address a meeting in Wales on Thursday, Sept. 25. U.K. 10-year gilts surged after G-20 expressed concern about the possibility of financial-market risk as a result of low interest rates.

The Group of 20 central bankers and finance ministers met in Australia over the weekend and also noted that the global economic growth remains uneven. The policy makers warned that low interest rates risk pushing up financial-market risk. To register for a free 2-week subscription to ForexMinute Premium Plan, visit www.forexminute.com/newsletter.

To contact the reporter of this story; Jonathan Millet at john@forexminute.com