5-Week High for the Pound as the Cyprus Debate Continues
The Pound appreciated to its strongest level against the Euro in five weeks as Cypriot lawmakers began their debate on legislation to unlock rescue funds. Sterling headed for its biggest weekly advance in a while after Cyprus’s Finance Minister Michael Sarris said the nation had failed to gain the financial support from Russia that it sought after rejecting a European bailout plan. They will need to strike a bailout deal with the European Union before Tuesday or face the collapse of its financial system.
Also, German business confidence unexpectedly fell from a 10-month high in March as Cyprus inflamed the euro region’s debt crisis.
Sterling also rose to a three-week high against the dollar yesterday after retail-sales data damped speculation the Bank of England will add to monetary stimulus.
On the FX Markets, the general news is better than expected, UK data releases pushed GBP/USD to a three week high of $1.5209 before easing back, while GBP/EUR rose to a six week high of €1.1778. The disappointing Euro zone PMI releases, plus ongoing concerns over Cyprus saw EUR/USD under pressure falling to a low of $1.2879.