Sterling jumps to one-month high

Sterling jumped to a one-month high past $1.45 on Thursday and held onto these gains in Asian trading on Friday. The pound was boosted after the Bank of England on Thursday kept interest rates steady as expected and said rates were more likely to rise than not over the next three years. The monetary policy committee voted unanimously to keep rates steady at record lows at 0.50%.

GBP/USD traded at $1.4504, also helped by a broadly weaker dollar. The pound moved further off a seven-year low of $1.3836 hit late in February when it was hurt by concerns over the potential exit of the UK from the European Union.

The euro hovered near a five-week high of $1.1342 and was on track to gain 1.6 percent on the week.

A continuing bounce in crude oil prices boded well for commodity-linked currencies. The Australian dollar rose to an eight-month peak of $0.7681 on Friday, while the Canadian dollar advanced to a five-month high of C$1.2946 versus the dollar overnight.

The dollar held near a 17-month low touched overnight against the yen. The greenback is being weighed down by a dovish Federal Reserve, which indicated after its meeting on Wednesday that scaled back its interest rate outlook. This weighed on the greenback.

US treasury yields have dropped sharply after the Fed policy meeting, driving the dollar’s decline to its weakest in five months against a basket of major currencies.

USD/JPY traded at 111.105 yen, just off a low of 110.67 touched yesterday that was its weakest since October, 2014.

The post Sterling jumps to one-month high appeared first on FXTM Blog.

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