The Great Britain pound advanced yesterday on the good macroeconomic data from the USA and the speculation the Federal Reserve is going to make the monetary policy even more accommodative.
The US leading index was up 0.9 percent in October, following the 0.1 percent increase in September. This report together with other data, like rising building permits and falling unemployment claims, pictures the US economy as strong and recovering. The Standard & Poorâs 500 Index reacted positively to the data and rose 0.5 percent.
The talks about a next round of quantitative easing are still in place despite all the good signs. Perhaps additional stimulus is justified, considering than not all signs were positive and the slowing inflation, the falling PPI and the worsening consumer sentiment show that the economy of the United States isn’t out of danger yet.
Anyway, had Forex trader had enough confidence to abandon safer currencies, like the dollar and the yen, in favor of the sterling.
GBP/USD closed at 1.5802 after opening at 1.5752 and reaching the daily maximum of 1.5887 yesterday. GBP/JPY was up from 121.23 to 121.49.
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