UK pound is losing ground today as global stocks drop. Concerns about the UK economy also continue to weigh on the sterling.
Global stock markets continue to fall today, and that is having a negative impact on the UK pound. Sterling is often affected by the performance of the stock market. It is no surprise that with global stocks struggling the UK pound the following suit.
Falling stocks are especially influential in the sterling’s trades against the euro. Against the US dollar, the UK pound is more susceptible to economic data. With the US economy showing signs of recovery there is a widening expectation of policy divergence between the Bank of England and the Federal Reserve.
While the UK economy has been showing signs of life, much of the growth has been somewhat lackluster and policy makers are having a hard time deciding when to start tightening up monetary policy.
As long as there is this uncertainty, and as long as risk aversion is present in the stock markets, there is a good chance that the pound will continue to struggle.
At 14:09 GMT GBP/USD is down to 1.4170 from the open at 1.4302. EUR/GBP it Is up to 0.7840 from the open at0.7763. GBP/JPY is down to 159.6940 run the open at162.7960.
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