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| At 1.3450, the pound is less than a cent from its recent 7-year high. |
The
pound is holding around 1.3540 versus the euro today, less than a
cent below its strongest in a full 7 years, or since December 21st
2007. Sterling isn’t moving much because, while UK manufacturers
grew more optimistic in February, Greece looks to have reached a deal
to remain in the Eurozone, leaving sterling and the euro at
even-stevens.
Sterling
has received a lift today, because the mood among UK manufacturers
climbed to +10 this month, according to the Confederation of British
Industry, ahead of forecasts for +6. This suggests that British
factories feel that economic conditions are set to improve in the
immediate future, and hence bodes well for the UK economy, lifting
sterling.
However,
the euro has also strengthened today, because the deadlock between
Greece and the Eurozone has at last been broken, as Greece has agreed
to seek a 6-month extension to pay back its loans. Greece hopes to
use these 6 months to renegotiate the terms of its bailout, but in
the meantime, the threat of Greece exiting the euro has now lessened,
thereby lifting the common currency.
