United Kingdom: Sterling Strength

The Pound surged higher following Scotland’s decision to remain in the United Kingdom with GBP/EUR hitting a two year high at 1.2802 before falling back to 1.2706 (EUR/GBP 0.7870). GBP/USD soared to a high of 1.6523 before meeting resistance and falling back to 1.6354 and currently trades at 1.6390 in mid-morning UK trading. With the Japanese Yen performing badly this month following the Japanese government’s economic forecast downgrade the Pound hit its highest level against the Japanese Yen since October 2008, pushing GBP/JPY through 180 to a high of 180.70 before falling back to around 178 Yen to the Pound.

With the risk of Scottish independence out of the way the focus now turns back to the strength of the UK economic recovery and the timing of any rate hike from the Bank of England.