The pound reached a near two-month high in early trading yesterday, but the euro eroded losses following positive data, with the pair closing marginally down at 1.1171.
- The euro found support yesterday after government data showed German industrial output rose more than economists had forecast as factories expanded production to meet export demand.
- Figures showed a larger than expected 2.7% rise in German industrial production, exceeding market forecasts of a 1.2%.
- In addition, data revealed that German exports jumped by 3.8% in September, which underscores Germany’s ability to export even in a strong euro environment and undermines the view of some eurozone finance ministers that euro strength is impeding the ability to export.
- Sterling has come under selling pressure this morning after Fitch Ratings agency said that the UK rating faces risks of losing its AAA status because the country needs “the largest budget adjustment.” The pound is currently trading half a percent down, hovering just above 1.11.
- Investors are awaiting an economic sentiment survey from Germany, released at 10:00, which is forecast to show a further fall this month and could put pressure on the single currency.
Related posts:
- Sterling found support from strong services PMI data yestreday, but lost ground to the euro in the later session
- Demand for the kiwi remained strong yesterday, but it has lost ground in the wake of comments from Ben Bernanke
- Euro lost ground vs the dollar following an easing in risk appetite
- The euro lost ground to the dollar on Friday as the rally in equities came to a halt
- Euro advanced yesterday but its progress has been halted today in the wake of dovish euro speculation
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