Sterling had a mixed performance yesterday, with early gains against its major currency partners being eroded throughout the day. Sterling started strongly in the early morning, rising to its highest levels against the US dollar since November 2009, while also appreciating against the euro. Recovery from the euro was swift, bringing sterling down to a similar level as markets were when opening. Sterling resisted a dollar recovery throughout the morning, only falling after the release of better-than-expected pending home sales data from the US.
Today sees the release of preliminary growth figures from the UK for the first quarter, which provides a broad measure of economic activity. Expectations are for a small but significant increase over the relevant comparatives with the quarter showing an increase of 0.9% and a 3.2% increase on an annual basis. It is likely to have an impact on sterling if the results deviate from these forecast levels.
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