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Sterling Up At 18 month High Against Euro

Sterling Up At 18 month High Against Euro

The British Pound maintains its status as one of the top performing currencies of 2021, aided recently by an accommodative Bank of England and a market that prefers both dollars and pounds to euros.

Investors expressed support for Sterling at the expense of the Eurozone’s single currency following a strong US labour data on Friday, something that may continue over the near-term given existing central bank dynamics. Ahead of the weekend we learnt the U.S. economy added over 900K jobs in July alone, growth that should allow the U.S. Federal Reserve to reduce its quantitative easing programme ahead of Interest rate rises in 2023. The data aided the Dollar higher against all its peers, but crucially the FX market showed a clear preference for the Pound relative to the Euro.

In level terms, EUR/USD starts the week near the heart of the 1.17-1.18 range. GBP/EUR opens this morning around the 1.1785 mark with GBP/USD also changing hands in the top half of 1.38-1.39.

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