Latest news with #pound
Zawya
16 hours ago
- Business
- Zawya
Sterling tiptoes lower; 40-year gilt auction, BoE speakers in focus
The pound trod water on Tuesday, holding mostly steady against the dollar and the euro, ahead of a raft of Bank of England speakers and an auction of long-dated government bonds that may offer a gauge of investor confidence in Britain's finances. Sterling was last down 0.15% against the dollar at $1.352, near last month's more-than three-year highs. The euro was also stable against the pound at 84.45 pence. Investors are torn between having to navigate the turbulence across markets stemming from the U.S. administration's erratic tariff policies and growing concern about the long-term finances of developed economies. Long-dated bonds in the United States, Japan and the UK in particular have been punished hard, which has pushed yields up sharply. In the case of the UK, 30-year gilt yields are the highest among developed economies, at 5.36%. Their extra premium over 30-year U.S. Treasuries, which are yielding some 5%, is not the result of better growth expectations, but of more precarious financing, which has stirred up extra volatility for the pound. On Tuesday, British 30-year government bond yields fell to a four-week low of 5.341%, down 7 basis points on the day and slightly outperforming U.S. Treasuries ahead of the auction of 1.25 billion pounds ($1.69 billion) of 2063 gilts. Bank of England Monetary Policy Committee member Catherine Mann suggested late on Monday the central bank should reconsider the pace at which it sells gilts, as the rise in long-dated yields could not be adequately offset by cutting rates faster. Strategists at RBC said Tuesday's bond auction was small by historic standards, which should boost demand, although they were less attracted by the longer-term prospects for the bond due to the prospect of more supply in that maturity bracket. "In the lead up to the UK's bond auction, UK gilts are outperforming across the curve and yields are falling. This suggests that bond vigilantes are out of sight for now, and that the bond market is not expecting any problem in today's auction," XTB research director Kathleen Brooks said. In domestic news, Thames Water, Britain's biggest supplier, said on Tuesday that U.S. private equity firm KKR had pulled out of a multi-billion pound rescue plan, reigniting fears the company will need to be nationalised to avoid financial collapse. The government has said it is on standby in case Thames Water fails to recapitalise and needs to go into temporary nationalisation to keep services running. BoE Governor Andrew Bailey, Deputy Governor Sarah Breeden, Mann herself and external MPC member Swati Dhingra are due to appear before a parliament committee at 0915 GMT.
Reuters
18 hours ago
- Business
- Reuters
Sterling tiptoes lower; 40-year gilt auction, BoE speakers in focus
LONDON, June 3 (Reuters) - The pound trod water on Tuesday, holding mostly steady against the dollar and the euro, ahead of a raft of Bank of England speakers and an auction of long-dated government bonds that may offer a gauge of investor confidence in Britain's finances. Sterling was last down 0.15% against the dollar at $1.352, near last month's more-than three-year highs. The euro was also stable against the pound at 84.45 pence. Investors are torn between having to navigate the turbulence across markets stemming from the U.S. administration's erratic tariff policies and growing concern about the long-term finances of developed economies. Long-dated bonds in the United States, Japan and the UK in particular have been punished hard, which has pushed yields up sharply. In the case of the UK, 30-year gilt yields are the highest among developed economies, at 5.36%. Their extra premium over 30-year U.S. Treasuries , which are yielding some 5%, is not the result of better growth expectations, but of more precarious financing, which has stirred up extra volatility for the pound. On Tuesday, British 30-year government bond yields fell to a four-week low of 5.341%, down 7 basis points on the day and slightly outperforming U.S. Treasuries ahead of the auction of 1.25 billion pounds ($1.69 billion) of 2063 gilts . Bank of England Monetary Policy Committee member Catherine Mann suggested late on Monday the central bank should reconsider the pace at which it sells gilts, as the rise in long-dated yields could not be adequately offset by cutting rates faster. Strategists at RBC said Tuesday's bond auction was small by historic standards, which should boost demand, although they were less attracted by the longer-term prospects for the bond due to the prospect of more supply in that maturity bracket. "In the lead up to the UK's bond auction, UK gilts are outperforming across the curve and yields are falling. This suggests that bond vigilantes are out of sight for now, and that the bond market is not expecting any problem in today's auction," XTB research director Kathleen Brooks said. In domestic news, Thames Water, Britain's biggest supplier, said on Tuesday that U.S. private equity firm KKR (KKR.N), opens new tab had pulled out of a multi-billion pound rescue plan, reigniting fears the company will need to be nationalised to avoid financial collapse. The government has said it is on standby in case Thames Water fails to recapitalise and needs to go into temporary nationalisation to keep services running. BoE Governor Andrew Bailey, Deputy Governor Sarah Breeden, Mann herself and external MPC member Swati Dhingra are due to appear before a parliament committee at 0915 GMT.
Zawya
6 days ago
- Business
- Zawya
Sterling ticks higher as strong data, trade deal buffer against stronger dollar
The pound ticked higher versus the dollar on Thursday, one of the few major currencies holding its ground against the greenback which earlier surged after a court blocked U.S. President Donald Trump from imposing import tariffs on other countries. At 0942 GMT, the pound was up 0.12% against the dollar at 1.347. Elsewhere, the euro, Japanese yen and Swiss franc all fell versus the dollar. Nevertheless the pound remains a fraction below the 1.359 level touched on Tuesday, its highest against the greenback since February 2022. "Due to the court ruling that Trump's tariffs are illegal, the pound has given back a chunk of gains made against the U.S. dollar," said George Vessey, lead FX & Macro Strategist at Convera in a note, though he added it remains above its 21-day moving average, a signal that a recent uptrend is still intact. The pound has gained almost 8% against the dollar in 2025 and is on track for its fourth consecutive monthly rise, as investors react to uncertain U.S. trade policy. It has also been boosted by strong data, including retail sales last week as well as the announcement of a UK-U.S. trade deal earlier this month. "GBP has done well in recent weeks on the back of U.S. and EU trade/reset deals, above-forecast consumer spending and less crowded positioning," said Kenneth Broux, head of corporate research FX and rates at Societe Generale, also flagging that the market is pricing fewer Bank of England rate cuts. Last week's inflation print led traders to scrap bets for a cut at the BoE's meeting scheduled for June, with more than 97% of traders now expecting the central bank to hold rates. The central bank slashed the bank rate by 0.25 percentage points to 4.25% on May 8. The Confederation of British Industry said on Thursday that business confidence in Britain's services sector hit a two-and-a-half-year low in the quarter to May. Data from market researcher Kantar on Wednesday showed British grocery price inflation jumped to 4.1% for the four weeks to May 18, its highest level since February last year. Against the euro, the pound was up 0.1% at 83.72, on track for its seventh straight week of gains. (Reporting by Lucy Raitano; Editing by David Holmes)
Reuters
6 days ago
- Business
- Reuters
Sterling ticks higher as strong data, trade deal buffer against stronger dollar
May 29 (Reuters) - The pound ticked higher versus the dollar on Thursday, one of the few major currencies holding its ground against the greenback which earlier surged after a court blocked U.S. President Donald Trump from imposing import tariffs on other countries. At 0942 GMT, the pound was up 0.12% against the dollar at 1.347 . Elsewhere, the euro, Japanese yen and Swiss franc all fell versus the dollar. Nevertheless the pound remains a fraction below the 1.359 level touched on Tuesday, its highest against the greenback since February 2022. "Due to the court ruling that Trump's tariffs are illegal, the pound has given back a chunk of gains made against the U.S. dollar," said George Vessey, lead FX & Macro Strategist at Convera in a note, though he added it remains above its 21-day moving average, a signal that a recent uptrend is still intact. The pound has gained almost 8% against the dollar in 2025 and is on track for its fourth consecutive monthly rise, as investors react to uncertain U.S. trade policy. It has also been boosted by strong data, including retail sales last week as well as the announcement of a UK-U.S. trade deal earlier this month. "GBP has done well in recent weeks on the back of U.S. and EU trade/reset deals, above-forecast consumer spending and less crowded positioning," said Kenneth Broux, head of corporate research FX and rates at Societe Generale, also flagging that the market is pricing fewer Bank of England rate cuts. Last week's inflation print led traders to scrap bets for a cut at the BoE's meeting scheduled for June, with more than 97% of traders now expecting the central bank to hold rates . The central bank slashed the bank rate by 0.25 percentage points to 4.25% on May 8. The Confederation of British Industry said on Thursday that business confidence in Britain's services sector hit a two-and-a-half-year low in the quarter to May. Data from market researcher Kantar on Wednesday showed British grocery price inflation jumped to 4.1% for the four weeks to May 18, its highest level since February last year. Against the euro, the pound was up 0.1% at 83.72, on track for its seventh straight week of gains.
Reuters
27-05-2025
- Business
- Reuters
Sterling weakens versus dollar but stays close to over three-year high
LONDON, May 27 (Reuters) - The pound ticked lower versus a broadly stronger dollar on Tuesday, yet remained close to a more than three-year high scaled on Monday as reduced bets on Bank of England rate cuts and some brighter economic data lifted the mood. At 1110 GMT, the pound was down 0.13% against the dollar at 1.35470. , not far from the 1.359 it touched on Tuesday, its highest level against the greenback since February 2022. The dollar was stronger against a range of currencies on Tuesday as investors took comfort from U.S. President Donald Trump's decision to delay higher tariffs on the European Union while the yen weakened as Japanese bond yields slumped. But the pound has gained more than 8% against the dollar in 2025 amid erratic U.S. trade policy. Michael Brown, senior research strategist at Pepperstone said while the pound's recent strength is largely a dollar weakness story, there are a few idiosyncratic factors at play. "We did have a much more hawkish than expected May policy decision from the BoE, then compounding that we had hotter than expected UK inflation last week which has seen participants continuing to trim their bets on BoE easing this year." Last week's inflation print erased market expectations for a cut at the Bank of England's next meeting in June. Bets are now heavily weighted to the BoE keeping the rate steady, with 93.6% of traders expecting that outcome . The central bank slashed the bank rate by 0.25 percentage points to 4.25% on May 8. UK economic data has also proved more resilient than expected this year, said Brown. Figures published on Friday showed British retail sales jumped in April. Elsewhere, a survey from the British Retail Consortium on Tuesday showed British shop prices fell slightly overall this month but food price inflation accelerated. Against the euro, the pound was up 0.27% at 83.74 and now in its seventh consecutive week of gains against the single currency.
