The Great Britain pound fell against the US dollar today due to the policy divergence between the central banks of the United States and Great Britain. Tuesday’s data from the United Kingdom was positive enough to allow the sterling to hold ground versus the Japanese yen and the euro.
Market participants question the ability of the Bank of England to start raising interest rates in the near future. At the same time, they are almost certain that the Federal Reserve would boost its interest rates tomorrow. The British currency demonstrated a significant loss against the dollar today due to the divergent policy outlook.
Meanwhile, the report released by Britain’s Office for National Statistics revealed that the UK Consumer Price Index rose 0.1 percent in November after falling at the same rate in October. The data was positive enough to give boost to the pound, allowing it to hold ground versus the euro, which itself received some support from the German ZEW Economic Sentiment that rose above analysts’ expectations.
GBP/USD declined from 1.5141 to 1.5059 as of 18:50 GMT today. EUR/GBP traded at 0.7256 after opening at 0.7258. GBP/JPY was basically at the opening level of 183.16.
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