The Pound Sterling had earlier recovered from a 1-month trough against the common currency Euro of the previous session, as this week’s economic data reduced the likelihood that the Bank of England will cut interest rates at the upcoming policy meeting. Money markets are now pricing in a 50% likelihood of a rate adjustment; on Monday, that figure had been around 70%. The latest jobs data from the UK showed job creation through the 3-month period in November is at the strongest level in almost a year. Markets will focus on tomorrow’s release of manufacturing and services sectors PMI data.
As of 11:07 am in London trade, the EUR/GBP was higher, trading at 0.8446 Pence, a gain of 0.03555%; the pair has ranged from a low of 0.84289 Pence to a high of 0.84501 Pence. The GBP/USD was lower at $1.313, down 0.0343%, moving off the earlier low of $1.31182, while the high was recorded at $1.31522.
Markets are waiting for the imminent release of a policy decision from the European Central Bank. Analysts have predicted that the ECB will maintain the status quo with the lending rate unchanged at 0% and the deposit rate at -0.5%. Christine Lagarde, head of the ECB, will speak shortly after the announcement. PMI data will also be released on Friday for the Eurozone and its component nations. A recent survey suggests that Germany’s data will have improved across the board for the manufacturing, services and composite surveys. The Eurozone’s three surveys are also likely to show lock-step improvement according to economists.