In early European deals on Thursday, the British pound showed strength against the currencies of US, Japan and Switzerland as investors look forward to the Bank of England’s interest rate announcement, which is due at 7:00 am ET.
But the pound eased from a 3-day high against the euro.
The BoE is widely expected to hold rates unchanged at 0.50% and maintain its asset purchase scheme at GBP 200 billion.
The pound climbed to a 6-day high of 1.4621 against the dollar at 3:10 am ET Thursday and a 2-day high of 1.6761 against the franc at 3:15 am ET. Although the pound eased thereafter, it rebounded shortly and is currently worth 1.6750 against the franc and 1.4610 against the dollar, compared to Wednesday’s close of 1.6694 and 1.4534, respectively. If the pound advances further, it may likely target 1.475 against the dollar and 1.690 against the franc.
The pound strengthened against the yen in early European deals on Thursday. Currently, the pound-yen pair is worth 133.30, up from yesterday’s close of 132.61. The next target level for the UK currency is seen at 136.3.
Japan’s final first quarter GDP and the consumer confidence report for May released today likely influenced the yen.
The pound is currently trading at 0.8267 against the euro, compared to a 3-day high of 0.8232 hit in early Thursday Asian deals. On the downside, 0.834 is seen as the next target level for the UK currency. The euro-pound pair closed yesterday’s trading at 0.8249.
German consumer price inflation continued to rise in May, in line with preliminary estimates, a final report from the Federal Statistical Office showed today.
The consumer price index (CPI) rose 1.2% year-on-year in May, faster than 1% in the previous month. It was the seventh annual increase in a row. On a monthly basis, the CPI rose 0.1% in May, reversing the 0.1% fall in April.
The European Central Bank is scheduled to announce its interest rate decision today at 7:45 am ET. Analysts expect the ECB to keep rates unchanged at 1%.
The U.S. trade balance report for April, weekly jobless claims data for the week ended June 05 and the monthly budget statement for May are slated for release in the North American session.