Pound within reach of new 2023 highs
A few wobbles for the Pound lately, but it’s still hovering near 2023 highs.
The big question for investors is whether the Bank of England has hit ‘peak rate’.
A lot of economists still think there’s one more 0.25% interest rate rise to come in June; then the pause button will be finally pressed.
Yesterday’s UK jobs data put that prediction in doubt.
Unemployment jumped unexpectedly whilst wage growth slowed. Not a good combo.
But the fact is the UK’s inflation rate remains stubbornly high.
The UK have the highest rate of inflation of any developed economy!
It’s basically forced the Bank of England to keep raising interest rates and cop the abuse.
The knock-on effect is the Pound has outperformed other major currencies in 2023, such as EUR, USD, AUD, CAD and NZD.
The real guesswork is how long the UK’s inflation rate stays higher than other countries? If you know the exact answer, please tell the folks at the Bank of England.
It’s only a matter of time before it begins to drop back.
For those looking to buy Euros and Dollars, you should consider taking advantage of the Pound’s current relative strength.
A note on the US Dollar – it’s being negatively impacted by debt ceiling fears and a fragile domestic banking sector. Be aware of heightened Dollar volatility and stay alert for opportunities.
So what next, what should you do?
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Current rates:
Wednesday 17th May 2023 at 12:15
£1.00 GBP = 1.1501 EURO
£1.00 GBP = 1.2456 USD
£1.00 GBP = 1.8721 AUD
£1.00 GBP = 1.9925 NZD
£1.00 GBP = 1.6808 CAD
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