Pound Higher On Risk Appetite
29 Gennaio 2020 - 07:03AM
RTTF2
The pound was notably higher against its most major counterparts
during the European morning session on Wednesday, as European
stocks rose despite lingering concerns about the rapidly spreading
Coronavirus.
Chinese officials confirmed nearly 6,000 cases of the mysterious
illness as foreign governments began airlifting their citizens out
of Wuhan.
Traders awaited the Bank of England's monetary policy decision
amid expectations to keep interest rate on hold given signs of
improvement in the economy.
Economists expect the bank to maintain its benchmark interest
rate at 0.75 percent and the quantitative easing at GBP 435
billion.
Thursday's meeting will be Governor Mark Carney's final chairing
as head of the BoE.
The central bank is set to announce the outcome as well as
release the minutes of the meeting at 7 am ET Thursday.
Traders awaited the developments on the Brexit, which is set to
happen this Friday.
Data from Nationwide Building Society showed that UK house
prices increased at a faster pace in January.
House prices grew 1.9 percent year-on-year in January, following
a 1.4 percent rise in December. Prices were expected to gain 1.5
percent. A similar faster growth was last reported in November
2018.
The pound traded mixed against its major counterparts in the
Asian session. While it held steady against the greenback and the
euro, it rose against the yen and the franc.
The pound rebounded to 1.3026 against the greenback, from a low
of 1.3004 set at 3:00 am ET. The next likely resistance for the
pound is seen around the 1.32 level.
The pound appreciated to a 2-day high of 1.2691 against the
franc, after dropping to 1.2658 at 3:00 am ET. If the pound rises
further, 1.29 is seen as its next resistance level.
The pound edged up to 0.8447 against the euro, from Tuesday's
closing value of 0.8458. The pound may face resistance around the
0.83 level.
Data from the European Central Bank showed that Eurozone broad
money supply grew at a slower pace in December and private sector
credit growth accelerated.
The broad monetary aggregate, M3 increased 5 percent in December
from last year, but slower than the 5.6 percent rise in
November.
In contrast, the pound dropped to 141.82 against the yen, from a
high of 142.35 seen at 5:45 pm ET. On the downside, 138.00 is
possibly seen as the next support level for the pound.
Data from the Cabinet Office showed that Japan's consumer
confidence remained unchanged in January.
On a seasonally adjusted basis, the consumer confidence index
remained unchanged at 39.1 in January. Economists had expected a
score of 39.5.
Looking ahead, U.S. wholesale inventories, advance goods trade
data and pending home sales for December are due in the New York
session.
The Federal Reserve announces its interest rate decision at 2:00
pm ET. Economists widely expect the central bank to keep benchmark
rate in a range of 1.50 percent to 1.75 percent.
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