Pound advances after BOE report boosts optimism on higher rates
By Bloomberg
The pound rose for a third day against the dollar after a Bank of England report showed mortgage approvals climbed more than economists forecast in June, stoking speculation higher interest rates are on their way.
Sterling also extended Tuesday’s gain versus the euro after the BOE said home-loan approvals climbed to 66,582, from an upwardly revised 64,826 in May. Economists surveyed by Bloomberg predicted a figure of 66,000. U.K. government bonds fell amid investor optimism the data bolster the case for policy makers to lift borrowing costs for the first time in eight years.
The data are “consistent with the economy moving ahead, consistent with the idea that the BOE is going to move into higher rates,” said Steve Barrow, head of Group-of-10 strategy at Standard Bank Group Ltd. in London.
The pound rose 0.2 percent to $1.5645 as of 11:46 a.m. London time, after dropping as much as 0.2 percent earlier.
It strengthened 0.2 percent to 70.71 pence per euro. Sterling jumped the most in two weeks on Tuesday after data showed U.K. economic growth accelerated.
The yield on 10-year gilts rose three basis points, or 0.03 percentage point, to 1.96 percent. The 5 percent security due March 2025 fell 0.29, or 2.90 pounds per 1,000-pound face amount, to 126.46.
Here we are to serve you with news right now. It does not cost much, but worth your attention.
Choose to support open, independent, quality journalism and subscribe on a monthly basis.
By subscribing to our online newspaper, you can have full digital access to all news, analysis, and much more.
You can also follow AzerNEWS on Twitter @AzerNewsAz or Facebook @AzerNewsNewspaper
Thank you!