Sterling trades back into 1.20 vs Euro
POUND
Sterling is hovering near a two week high against the US currency this morning and is trading back into 1.20 against the Euro. The pound is very sensitive at the moment to speculation of further QE happening in February and developments with the Greek Private Sector Initiative (PSI) talks. Today is a quiet one for UK economic data but this may well be the calm before the storm with Public sector borrowing figures due tomorrow morning, Mervyn King speaking in the evening, MPC minutes and preliminary (GDP) growth figures due for the last quarter of 2011 on Wednesday. There is also a raft of other data but the GDP number is particularly important as many expect it to show the UK economy contracted at the end of last year, providing further support for QE and forecasts that the economy is dipping back into a recession.
EURO
The Euro is trading relatively flat against the pound but has made further gains against a weaker USD, now trading comfortably into 1.29.
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