Sterling up as Fundementals Postive
|Published: ||1 Dec at 10 AM|
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The pound has bounced heavily from the same time last month versus the ailing euro, rising to a two month high on Tuesday after European sovereign risk concerns undermined the single currency.
This gave the red light to the already risk averse investors as sentiment once again boosted the dollar as it swelled under its safe haven status.
The rescue package for Ireland failed to dampen speculation that other bailouts may be needed in the Euro zone with the names of Spain and Portugal never far away from people thoughts. Euro has fallen to a 10 week low against the dollar.
Italy is now in the firing line along with Spain and Portugal as the market remains extremely nervous about sovereign risk and the ongoing threat to the euro over the long term.
Data in the UK show that house prices fell again November, the Nationwide building society has said.
The average price dropped by another 0.3% to leave it 0.4% higher than the same time last year.
The fall in house prices showed the forth drop in the past five months and an indication of the recent trend was highlighted in the fact that the last quarter was in total 1.3% lower than the three months previous.
The Nationwide's economist Martin Gahbauer said he expected more of the same in the coming months.
"There is little evidence to suggest that house price declines are likely to accelerate in the months ahead," he said.
"Much of the weakness in property values since the spring has been driven by a return of sellers to the market.
"However, there is little to indicate that these sellers need to achieve a sale urgently for financial or economic reasons, which means that the downward pressure on house prices is only modest," he added.
Overnight we have been knocked a little as British Consumer Confidence weakened more than expected in November as people were most downbeat about their personal finances in almost two years.
Markets have been affected slightly by the housing data, but versus the euro this in early morning trading we have seen the pound come back to test the levels that we only saw in the summer, and that was for the first time in over two years so the short term out look for sterling against euro looks good.
Traders have been buoyed higher after some stronger than expected manufacturing date in the UK, which is an indication that trading goods across the globe seems to be picking up, which will boost our exports and signal that the UK are staging a slow but steady recovery from the recession