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Pound Approaches 7-Week High Versus Dollar After Carney Comments - (Bloomberg)

Posted by Chris Advincula on Aug 8, 2013 6:31:00 AM

The pound approached a seven-week high against the dollar after Bank of England Governor Mark Carney reiterated policy makers’ commitment to meeting their 2 percent inflation target.

Sterling was about 0.3 percent from its strongest level in a month versus the euro. The central bank yesterday raised the growth forecasts in its Inflation Report and pledged to keep its stance accommodative until the jobless rate falls to 7 percent. Bringing the inflation rate to 2 percent is “without question” the central bank’s target, Carney said today on BBC Radio 4’s “Today” program. The Debt Management Office sold 1.3 billion pounds ($2.01 billion) of 20-year inflation-linked bonds today.

The pound gained 0.1 percent to $1.5511 at 10:47 a.m. London time after rising to $1.5531 yesterday, the highest level since June 21. Sterling was little changed at 86.10 pence per euro after appreciating to 85.79 pence yesterday, the strongest since July 10.

The pound has risen 1.7 percent in the past three months, according to Bloomberg Correlation-Weighted Indexes that track 10 developed-nation currencies, amid signs the economy is recovering. The euro strengthened 3.6 percent and the dollar gained 1.8 percent.

Gilts have lost investors 3.4 percent this year through yesterday, according to Bloomberg World Bond Indexes. Treasuries dropped 2.6 percent and German bonds declined 1.4 percent. 

 

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