Pound Declines Amid BoE Haskel's Remarks
June 26 2018 - 2:28AM
RTTF2
The pound fell against its major counterparts in the European
session on Tuesday, following comments from the Bank of England MPC
member John Haskel suggesting that interest rates could rise more
gradually.
Speaking to the Treasury select committee, incoming member
Haskel said that the slack in the U.K. economy may be higher than
currently examined.
"The first risk involved in raising interest rates would be if
this is done too quickly, disturbing investment and borrowing plans
by more than would have been expected," he added.
Haskel cautioned over rising protectionism that could harm the
UK economy by driving up costs and hurting economic demand.
Data from UK Finance showed that UK mortgage approvals increased
to a four-month high in May.
The number of mortgage approvals increased to 39,244 in May from
38,327 in April. This was the highest since January and above the
expected level of 38,250.
The currency rose against its major counterparts in the Asian
session, with the exception of the euro.
The pound weakened to near a 2-week low of 0.8822 versus the
euro, after having advanced to 0.8798 at 5:00 am ET. The pound is
likely to find support around the 0.89 level.
Pulling away from an early 4-day high of 1.3292 against the
greenback, the pound reversed direction and fell to a 5-day low of
1.3207. The next likely support for the pound is seen around the
1.31 level.
The pound edged down to 144.97 against the yen and 1.3067
against the franc, reversing from its early high of 145.77 and a
4-day high of 1.3123, respectively. If the pound falls further,
142.00 and 1.29 are likely seen as its next support levels against
the yen and the franc, respectively.
Looking ahead, U.S. S&P/Case-Shiller home price index for
April and consumer confidence index for June will be out in the New
York session.
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