The Pound Sterling edged higher against the US Dollar and is poised to finish off its 3rd straight day of gains after the latest data raised investors’ hopes. British housing figures as reported by Halifax showed housing prices rising in the 3-month period through March to 2.7%. Those figures beat analysts’ forecasts and helped to firm sentiment for a May rate increase from the Bank of England. Moreover, it is an indication that the UK economy is not too weak thus laying the groundwork for a possible second rate increase later in the year.
As reported at 11:05 am (BST) in London, the GBP/USD was trading at $1.4086, down 0.02%; the pair earlier hit a peak of $1.4118 while the session low is at $1.4079. The EUR/GBP is trading at 0.8711 Pence down 0.1101%; the pair has ranged from a trough of 0.86980 Pence to a peak of 0.87220 Pence in this trading session.
Brexit Fears on the Back Burner
While analysts do point out that the rise in housing prices is still lower than the same period before the Brexit referendum in 2016, the news today is still quite welcome. One FX strategist said that after the Brexit vote how housing prices responded was of great concern to investors and given the rise it suggests that households have greater confidence in a positive outcome for the Brexit negotiations and for the actual withdrawal of Britain from the European Union.