Today has seen more sterling strengh as it appears investors are starting to favour sterling despite news that the housing market prices had dropped 0.9% in April.
"Risk appetite is looking a little bit more favourable. Even with the rate cuts that we've seen, the yield attractiveness of sterling is reasonable," Rabobank market strategist Jeremy Stretch said.
Two in three people own their own home in the U.K so the housing market does generally have a pretty big impact on Sterling and most speculation is that this could get worse in the coming months.
"The domestic news remains relatively weak ... Our own view is that the UK economy does have problems, and we expect growth to decelerate markedly in the second half of the year," said Robert Minikin, senior FX Strategist at Standard Chartered.
It also seems that we could see further rate cuts down from the current 5% in the next few months, which could also start the Sterling slide again.
If you have any questions regarding this report, or wish to discuss an upcoming requirement with an experienced broker that will talk on your level, please email me at djw@currencies.co.uk providing a telephone number and i will get in touch straight away.
Have a great day and thanks for reading!
Daniel Wright
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