Latest news with #pound
Zawya
a day ago
- Business
- Zawya
Sterling keeps climbing on struggling dollar
LONDON - The pound was set for its biggest weekly gain against the dollar in nearly four months on Friday and held close to its near four-year high hit the previous day, though that was more due to dollar weakness than sterling strength. The pound was last up 0.14% on the dollar at $1.13745, just off Thursday's top of $1.37701, the highest since late 2021. It was broadly steady on the euro, at 85.24 pence, underlining the fact that the move in the pound against the dollar - referred to as cable by financial markets - has much more to do with the dollar. "The gains in cable reflect mostly this year's weakness in the dollar and the strength of the euro, which has dragged the pound higher due to the limited parameters of the EUR/GBP trading range," Rabobank analysts said in a note. The pound has gained 2.2% against the dollar this week, its most since early March, as the greenback's short-lived gains during the Israel-Iran conflict fade. The main domestic support for the pound this year has come from the Bank of England being slower to cut interest rates than peers, particularly the European Central Bank, as inflation remains sticky. "Core inflation in the UK has basically stopped moving for the past year - hard to say why. BoE officials are quite concerned. That makes it difficult to cut rates and also the economic outlook is not improving," Michael Pfister, FX analyst at Commerzbank, said. Analysts also said they were watching this week's political drama given what Rabobank described as "the overhang of a very large debt/GDP ratio and a UK current account deficit." Prime Minister Keir Starmer this week sharply scaled back planned welfare cuts after more than 100 of his Labour Party lawmakers publicly opposed the reforms, which sought to shave 5 billion pounds ($6.9 billion) per year off a rapidly rising welfare bill. (Reporting by Alun John and Lucy Raitano; Editing by Andrew Heavens)
Reuters
a day ago
- Business
- Reuters
Sterling keeps climbing on struggling dollar
LONDON, June 27 (Reuters) - The pound was set for its biggest weekly gain against the dollar in nearly four months on Friday and held close to its near four-year high hit the previous day, though that was more due to dollar weakness than sterling strength. The pound was last up 0.14% on the dollar at $1.13745, just off Thursday's top of $1.37701, the highest since late 2021. It was broadly steady on the euro, at 85.24 pence, underlining the fact that the move in the pound against the dollar - referred to as cable by financial markets - has much more to do with the dollar. "The gains in cable reflect mostly this year's weakness in the dollar and the strength of the euro, which has dragged the pound higher due to the limited parameters of the EUR/GBP trading range," Rabobank analysts said in a note. The pound has gained 2.2% against the dollar this week, its most since early March, as the greenback's short-lived gains during the Israel-Iran conflict fade. The main domestic support for the pound this year has come from the Bank of England being slower to cut interest rates than peers, particularly the European Central Bank, as inflation remains sticky. "Core inflation in the UK has basically stopped moving for the past year - hard to say why. BoE officials are quite concerned. That makes it difficult to cut rates and also the economic outlook is not improving," Michael Pfister, FX analyst at Commerzbank, said. Analysts also said they were watching this week's political drama given what Rabobank described as "the overhang of a very large debt/GDP ratio and a UK current account deficit." Prime Minister Keir Starmer this week sharply scaled back planned welfare cuts after more than 100 of his Labour Party lawmakers publicly opposed the reforms, which sought to shave 5 billion pounds ($6.9 billion) per year off a rapidly rising welfare bill.
The Independent
2 days ago
- Business
- The Independent
FTSE up as pound hits near four-year high
Miners and defence stocks helped support the FTSE 100 on Thursday, shaking off a stronger pound, which serves as a headwind for the international earner-heavy index. The pound spiked to its best level against the dollar since October 2021. The dollar fell on reports that US President Donald Trump is looking at naming a new Federal Reserve chief. Weaker US data also did little for the dollar. The FTSE 100 index rose 16.85 points, 0.2%, at 8,735.60. The FTSE 250 added 176.62 points, 0.8%, at 21,474.66, and the AIM All-Share climbed 6.59 points, 0.9%, at 767.04. In European equities on Thursday, the CAC 40 in Paris ended flat, while the DAX 40 in Frankfurt added 0.6%. The pound was quoted higher at 1.3733 dollars at late on Thursday afternoon in London, compared to 1.3622 dollars at the equities close on Wednesday. The euro stood at 1.1698 dollars, higher against 1.1626 dollars. Against the yen, the dollar was trading at 144.48 yen, lower compared to 145.60 yen. The single currency had hit an intraday high of 1.1744 dollars, its best level since September 2021, while sterling had bought 1.3764 dollars, its loftiest level since October 2021. The Wall Street Journal reported on Wednesday that Mr Trump is considering naming a new chair of the Fed as early as September or October, undermining Jerome Powell, whose term has another 11 months to run. Citing 'people familiar' with the matter, the newspaper said Mr Trump's impatience with the US central bank's slow approach to cutting interest rates has prompted him to consider accelerating his announcement of a successor as Fed chair. Under consideration as replacements, according to the WSJ, are Treasury Secretary Scott Bessent, economic adviser Kevin Hassett, and former Fed governor Kevin Warsh, with Mr Trump evaluating each's commitment to cutting interest rates. The news knocked the dollar, sending the euro and sterling to multi-year highs against it. The Bureau of Economic Analysis said the US economy shrunk 0.5% on an annualised quarter-on-quarter rate in the first three months of the year. The second estimate had put the decline at 0.2%. On Friday, BEA will release personal consumption expenditure data for May, including core year-on-year PCE data, which is the key inflationary gauge for the Federal Reserve. The yield on the US 10-year Treasury was quoted at 4.28%, narrowing from 4.32% a day earlier. The yield on the US 30-year Treasury was quoted at 4.84%, narrowing from 4.86%. In New York, the Dow Jones Industrial Average was up 0.7%, the S&P 500 and Nasdaq Composite each added 0.6%. Brent oil was quoted lower at 67.83 dollars a barrel late on Thursday afternoon in London, down from 68.18 dollars on Wednesday. Gold was lower at 3,322.21 dollars an ounce against 3,323.77 dollars. In London, miners shone on the FTSE 100. Anglo American surged 6.9%, Antofagasta added 6.0% and Glencore perked up 5.5%. Defence stocks were also higher, with BAE Systems up 3.8%. 3i Group climbed 4.8%. It said Action continued to perform 'strongly', with like-for-like sales growth of 6.9% in the year to date and net new store openings of 111 on track with expansion plans. Action's product assortment includes decoration, DIY, garden and outdoor, household goods, multimedia, health, stationery and hobby, toys and entertainment, food and drink, laundry and cleaning, personal care, pet, fashion and linen. 'The like-for-like performance continues to be transaction driven with a strong contribution from seasonal sales,' 3i said. BP rose 1.3%, while Shell added 0.5%. Shell formally denied a press report that it is in talks to buy rival oil major BP. 'In response to recent media speculation Shell wishes to clarify that it has not been actively considering making an offer for BP and confirms it has not made an approach to, and no talks have taken place with, BP with regards to a possible offer,' the London-based energy company said in a statement. 'Shell confirms it has no intention of making an offer for BP,' the company added. Volex climbed 18%. It reported increased earnings for the 2025 financial year and raised its dividend in an 'outstanding year'. The manufacturer of critical power and data transmission products said revenue was up 19% at 1.09 billion dollars in the 12 months to the end of March from 912.8 million dollars a year ago. Pretax profit climbed 25% to 64.3 million dollars from 51.6 million dollars, while operating profit was up 30% to 82.9 million dollars from 63.9 million dollars. Next 15 slumped 28%. The stock is down around three-quarters over the past 12 months. It warned that profit for the current financial year will fall materially short of expectations, citing a weaker dollar, rising investment costs, and pipeline conversion issues at its innovation business Mach49. The London-based business growth consultant said more than half of its revenue is dollar-denominated, exposing it to adverse foreign exchange movements. The biggest risers on the FTSE 100 were Anglo American, up 138.0p at 2,143.5p, Antofagasta, up 104.0p at 1,830.0p, Glencore, up 14.9p at 288.2p, Entain, up 44.8p at 900p, and 3i Group, up 189.0p at 4,138.0p. The biggest fallers on the FTSE 100 were Unilever, down 114.0p at 4,388.0p, British American Tobacco, down 74.0p at 3,443.0p, Hikma, down 37.0p at 1,999.0p, HSBC, down 14.5p at 875.5p, and Haleon, down 5.8p at 377.6p. Friday's economic calendar has the US PCE data at 13:30 BST, after eurozone consumer confidence data at 10:00 BST.
BBC News
2 days ago
- Business
- BBC News
Pound touches near 4-year high as Trump rattles dollar
The pound briefly hit its highest level against the dollar for almost four years after markets were unnerved by a report that US President Donald Trump could bring forward the naming of the new head of the US central bank. Sterling rose above $1.37, which is the strongest since October dollar weakened after the Wall Street Journal reported Trump had considered naming Jerome Powell's replacement as head of the Federal Reserve by September or US Fed is independent from the government and Mr Powell chairs a committee that decides on interest rates which have remained unchanged this year, prompting a series of angry outbursts from Trump. On Wednesday, Trump called Mr Powell "terrible" and said he was looking at "three or four people" who could replace him. Mr Powell's term is due to end in May are concerns the US president could install someone who is sympathetic to his this week, Mr Powell told US lawmakers the Fed would wait and see how the American economy reacts if Trump's so-called retaliatory tariffs against a range of countries come into force next month, after being paused until 9 July. The Fed is concerned that the levies, which are paid by the businesses importing the goods, might push up US economy shrank in the first three months of this year - the first decline for three years - as government spending fell and imports rose as firms raced to get products into the country before the tariffs went Morgan, the investment bank, has lowered the chance of the US economy falling into recession this year but at 40% the probability of a slowdown remains comparatively Hense, a senior portfolio manager at RBC BlueBay Asset Management, said traders were betting the dollar would fall "in this environment, where there is an erosion of institutions".While Kit Juckes, chief FX strategist at Societe Generale, said: "I think the market is pricing in President Trump appointing someone who at least at first sight appears more sympathetic to his cause."Mr Powell was himself a Trump appointee. During Trump's first term in the White House, Mr Powell replaced the then Fed chair Janet had criticised Ms Yellen for keeping interest rates too low, stating: "I think she should be ashamed of herself."Ms Yellen went on to become the US Treasury Secretary under President Joe Biden and said she did not think that Trump had a grasp of macroeconomic policy.
Bloomberg
2 days ago
- Business
- Bloomberg
What's Behind Persistent US Dollar Weakness?
Donald Trump's frustration with Federal Reserve boss Jerome Powell is not the only factor. By Save Welcome to the award-winning Money Distilled newsletter. I'm John Stepek. Every week day I look at the biggest stories in markets and economics, and explain what it all means for your money. The pound was looking very strong this morning. We're back up above $1.37. If this continues for much longer, we might get back above the post-Brexit highs (in the region of $1.44). What have we done to deserve such currency market confidence?
