UK pound is mixed against the other majors today, heading higher against the US dollar, even as the pound drops against the euro. Investors are awaiting UK data, which is expected to be weak.
The Olympics are over, and now it’s time to focus on the fundamentals of the UK economy. Last week, Bank of England Governor Mervyn King indicated that interest rates wouldn’t be cut anytime soon, and that helped the UK pound a bit. However, there are now expectations that the BOE will have no choice but to pump more money into the economy, since data releases this week are expected to be disappoinging.
This week, data on inflation, unemployment, and retail sales are expected to be released. Most expect lackluster results, especially in terms of unemployment and retail sales. On top of that, while the UK pound is independent of the eurozone, the United Kingdom still has exposure to eurozone problems. This is weighing on the pound against other high beta currencies, even as the pound sees gains against the US dollar.
At 14:20 GMT GBP/USD is higher at 1.5713, up from the open at 1.5673. EUR/GBP is up to 0.7870 from the open at 0.7843. GBP/JPY is higher at 123.0305, up from the open at 122.5950.
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