King talks the pound lower

Currencies Direct September 24th 2009 - < 1 minute read

Bank of England Governor Mervyn King says that UK growth may be beginning to pick up and is well placed for recovery. People however should not get too carried away as growth is very small after a very big contraction. The weaker pound is helping the necessary rebalancing of the UK economy in regard to exports. On the back of this Sterling has dropped by over a cent against both the dollar and euro

Overnight, the decision by the Fed to leave interest rates on hold is still being digested by markets.This morning, onfirming the positive tone of last week’s ZEW survey and yesterday’s ‘flash’ PMIs, the September German IFO business survey is forecast to edge higher to 91.5 from 90.5 in August. The expectations index, arguably the best gauge of economic

prospects has posted successive increases since the start of the year, indicating economic growth may have picked up in Q3. We also expect positive data from the US this afternoon, with initial jobless claims forecast to post another fall in the week ended September 19 and a fifth successive rise in existing home sales in August.

In the UK, Spencer Dale,MPC member and chief economist at the BoE, takes to the stage at 13.15,in Exeter, you have been warned. Expect more negativity surrounding the pound.

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