British Pound (GBP) Exchange Rate: Sterling Climbs to Four-Day High against US Dollar
The Pound advanced to its best level since last Friday against the US Dollar as data continued to support expectations that the UK economy will continue to expand over the next year.
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The currency hit session highs following the release of better than expected data which showed that UK mortgage approvals and retail sales improved. According to a report released by the British Bankers Association, mortgage approvals in the UK surged by 57% in January. The figure showed that 49,972 new mortgages were approved, the highest number seen in 76-months.
A separate report released by the Confederation of British Industry showed that retail sales in the UK increased at their fastest pace since June last year this month. The CBI trades survey surged to 37, up from the 14 recorded in the previous month, smashing economist forecasts for a rise to 15.
The US Dollar could recover some ground if a consumer confidence report comes in positively. Investors are growing increasingly jittery when it comes to US data releases due to a recent run of reports coming in below expectations. Job growth, retail sales and housing reports have all underwhelmed investors in recent weeks. Concerns are mounting that the world’s biggest economy is beginning to slow down.
Against the Euro the Pound was trading higher due to the single currency being weighed upon by the European Commission, which cut its inflation forecast for the region in 2014 from a rise of 1.5% down to 1%. It also warned that debt levels in some EU nations will rise. Investors were spooked as the forecast adds to the possibility that the ECB will introduce new stimulus measures to tackle the threat of deflation.