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Pound hits 19-month high against euro
Business Digest: Pound boosted by debt repayments due from European banks and rumours of UK interest rate hike
The pound reached a 19-month high against the euro today as investors expressed concern at loan repayments due from European banks later this week and hope that the UK could raise interest rates sooner than previously expected.
The pound rose almost half a cent to 1.2327 euros. "Certainly the path is down for the euro," said Christian Lawrence, currency strategist at RBC Capital Markets.
European banks must repay €442bn to the European Central Bank on Thursday, provoking fears that there will be less money available in the financial system.
Meanwhile, currency investors also seized on a comment by Bank of England Monetary Policy Committee member Andrew Sentence, who told Reuters that Britain's austerity Budget, announced last week, did not remove the need to start raising interest rates now.
Read a full report at Reuters UK. ·
