- GBP higher as rate rise sooner than expected
- Euro weaker in markets
GBPUSD 1.3952 GBPEUR 1.1371 EURUSD 1.2269 USDCAD 1.2596 GBPINR 89.75 GBPAUD 1.7899 GBPAED 5.123
- (Reuters) - Sterling jumped as much as 1.3 percent against the dollar on Thursday after the Bank of England said interest rates probably needed to rise sooner and by a bit more than it had previously thought because of the strength of the global economy. Before the BoE announcement, in which the bank also raised its UK economic forecasts, markets had priced in a 50 percent chance of a rate hike by May.
- The central bank’s Monetary Policy Committee raised interest rates for the first time in a decade in November. The BoE voted unanimously to keep rates on hold at 0.5 percent on Thursday but Governor Mark Carney and colleagues saw a growing need to move faster on raising rates to keep a grip on inflation.
- The dollar, against a basket of currencies, was flat on Friday after gaining 1.1 percent this week. The U.S. currency remains down 2.1 percent this year.
The dollar also recovered against the yen in early European trading after earlier falling to near four-month lows as investors sought out safety in the Japanese currency.
- (Reuters) - The euro gained against the dollar on Friday but the single currency was still headed for its worst weekly performance since October after the global stock market sell-off squeezed investors betting against the greenback out of their positions.
The euro was up 0.2 percent at $1.227, having lost 1.47 percent against the dollar this week. So far this year, the euro remains 2.28 percent higher. It hit a three-year high of $1.2538 in late January.