Wednesday June 24, 2009
LONDON: Sterling edged lower against the dollar and fell more sharply versus the euro on Tuesday with the market taking its cue from equity markets to gauge risk appetite. Early losses in UK share prices pushed the pound to a low of around $1.6210. But the British currency pared some losses as share prices recovered. Sterling also lost traction against the dollar after US data showed sales of previously owned homes in the United States rose at a slower-than-expected pace in May.
Sales rose 2.4 percent to an annual rate of 4.77 million units from a downwardly revised 4.66 million pace in April, below forecasts for a 4.81 million-unit pace. "The overall climate (for sterling) remains defensive," said Asraf Laidi, chief market strategist at CMC Markets. By 1442 GMT, sterling was down 0.3 percent at $1.6283, after hitting a session low of $1.6211, according to Reuters data. The euro was up 1.3 percent at 85.93 pence, having fallen to around 84.00 pence on Monday, its lowest level since early December.
The single currency also rose 1.0 percent against the dollar. "There is some uncertainty about the nature of recovery in the UK economy, so we are seeing some near-term headwinds for sterling," said Phyllis Papadavid, currency strategist at Societe Generale in London. But she said the pound would still be attractive over the medium-term as sentiment and economic data improved.
Sterling was well-supported at a key technical level around $1.6180, technical analysts said. Figures from the British Bankers' Association showed the number of mortgages approved for house purchase rose 15.8 percent on a year earlier in May, ending months of annual declines.
(Reuters)
LONDON: Sterling edged lower against the dollar and fell more sharply versus the euro on Tuesday with the market taking its cue from equity markets to gauge risk appetite. Early losses in UK share prices pushed the pound to a low of around $1.6210. But the British currency pared some losses as share prices recovered. Sterling also lost traction against the dollar after US data showed sales of previously owned homes in the United States rose at a slower-than-expected pace in May.
Sales rose 2.4 percent to an annual rate of 4.77 million units from a downwardly revised 4.66 million pace in April, below forecasts for a 4.81 million-unit pace. "The overall climate (for sterling) remains defensive," said Asraf Laidi, chief market strategist at CMC Markets. By 1442 GMT, sterling was down 0.3 percent at $1.6283, after hitting a session low of $1.6211, according to Reuters data. The euro was up 1.3 percent at 85.93 pence, having fallen to around 84.00 pence on Monday, its lowest level since early December.
The single currency also rose 1.0 percent against the dollar. "There is some uncertainty about the nature of recovery in the UK economy, so we are seeing some near-term headwinds for sterling," said Phyllis Papadavid, currency strategist at Societe Generale in London. But she said the pound would still be attractive over the medium-term as sentiment and economic data improved.
Sterling was well-supported at a key technical level around $1.6180, technical analysts said. Figures from the British Bankers' Association showed the number of mortgages approved for house purchase rose 15.8 percent on a year earlier in May, ending months of annual declines.
(Reuters)
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