Forex focus: sterling turns the corner?

Surprisingly, sterling has been the best-performing major currency so far this year, writes Liz Phillips 

It’s up against the US dollar and the euro, as well as against last year's strongest currencies - the Swiss franc, Japanese yen and Aussie dollar.

This is great news for pensioners and those living off savings held in sterling. You could be getting the best rates for two years.

But for the thousands who had given up and are just about to head home, it won’t be welcome unless they took steps to lock into the best rates for their local currency last year when the pound was struggling.

So what is going on?

Part of the boost has been a growing belief that the UK may be the first major economy to raise interest rates. The Bank of England Monetary Policy Committee meets tomorrow and faces a difficult decision. The jump in oil prices caused by the unrest in Egypt and neighbouring countries will fuel inflation, already at worrying levels. Yet a hike in rates may damage the fragile economy.
Source: telegraph.co.uk

 

Posted in: Forex