This week has seen a number of better than expected pieces of UK economic data. The Purchasing Manager Index data released this week by Markit Economics has shown a better than expected expansion in the UK manufacturing, construction and service sectors. This data has eased concerns relating to the sustainability of the UK economic recovery and gives weight towards the prospect of an interest rate hike from the Bank of England later this year.
Elsewhere, the European Central Bank (ECB) continued to hold its interest rate at 1% and in the following press conference, ECB President Trichet was less hawkish than many analysts had expected, signalling that despite recent price rises he believed the current rate was appropriate. Any interest rate rise from the ECB in the near term now seems rather unlikely.
As a result the Pound has appreciated to 1.18 against the Euro and remains above 1.60 against the US Dollar.
The exchange rates mentioned in the above blog are based on the current interbank rate. The exchange rate you are able to achieve will depend on the amount of currency being purchased. Please do not hesitate to contact the dealing team on +44 (0) 1695 581 669 for a live quote.