Sterling had a mixed day, trading in a narrow range against both the euro and the US dollar. Data from the UK showed that growth in the construction industry had slowed from expectations in May and, together with the reported drop in mortgage approvals, suggests that the housing boom may be slowing. With the more influential data from the services industry out today, the markets did not react greatly to this worse than expected construction data.
Attention continues to be drawn towards Thursday’s interest rate decisions from the Bank of England (BoE) and the European Central Bank (ECB). Although recent disappointing data from the UK has tempered speculation that the BoE may increase rates, its Eurozone counterpart is expected to reduce their borrowing rate and increase liquidity so as to boost the Eurozone economy.
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