Optimistic Outlook for UK Economy Helps Sterling Rise

The Great Britain pound rose today as the forecast that Britain’s economy would prove stronger than the economy of the European Union amid the fiscal crisis outweighed the negative impact of the poor US non-farm payrolls.

The economists predicted that the UK economy would expand 2 percent in 2011, while the Eurozone economy would grow 1.5 percent. The experts forecast that the Bank of England would keep its bond-purchase plan and the interest rates unchanged on its January 13th meeting. The outcome of the meeting is still uncertain as the minutes of the previous meeting showed that the bank’s policy makers are divided in the opinions about the best way to improve the UK economy.

The gains of the sterling may be limited by the negative impact of the poor employment data from the US, which worsened the outlook for the global economic growth. The US non-farm payrolls showed the growth by 103,000 instead of expected 159,000.

GBP/USD advanced from 1.5468 to 1.5557 as of 16:49 GMT today, while GBP/JPY rose from 128.89 to 129.23

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