020 7898 0500Sterling had a cracker of a day yesterday, making solid gains on the back of an improved labour market whilst hitting fresh 2.5 year highs against the US dollar following the US Federal Bank’s central bank meeting. With the unemployment rate falling to 7.4%, its lowest level since 2009, it was an important step closer to the Bank of England’s 7% target. As a result, sterling advanced for the first day in six against the US dollar, whilst also climbing against the euro. Supporting this was the claimant count change, which also showed a figure significantly better than expected. Sterling then received a significant boost across the board when the Federal Reserve announced a cut in its quantitative easing programme – the start of the long anticipated taper. The other event of the day was the BoE’s rate setting meeting, where the Monetary Policy Committee voted on the Asset Purchase Facility and Central Bank Interest Rate. As expected, there was no change in policy, however, the accompanying statement threw up some caution, with policy makers showing concern that sterling’s continued strength could actually harm the economic recovery. Today the only major release due from the UK is the Retail Sales figure, which could further boost optimism in the currency. Call your trader now for the latest sterling rates, after another strong day.
