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Pound Continues Its Demise

Published 12/10/2016, 05:16
Updated 18/08/2020, 10:10

Sterling has continued lower today with the UK’s currency falling lower against the US dollar, Euro and Japanese Yen. The FTSE 100 is little changed on the day, after ending yesterday’s session at the second-highest level on record.

Oil rallies on Putin comments

Russian President Vladimir Putin was speaking in Istanbul at an energy conference yesterday and suggested that the world’s largest energy exporter would support a production cut by OPEC. The comments saw crude benchmarks continue their recent rally with front month Brent futures trading within 30 cents of their highest level of the year. The rise in oil prices has boosted sentiment and fed through to the FTSE, elevating the market to close near record-highs.

FTSE trades flat near previous peak

The FTSE 100 is little changed on the day, but some individual shares are still experiencing significant moves. Whitbread (LON:WTB) leads a list of the gainers and is higher by just over 3% at the time of writing, with retailers Next and Burberry both also firmly in the green. Despite not making the blue-chip index Ted Baker’s results could well have improved sentiment in the sector, with the luxury retailer’s latest trading update showing strong growth in both the top and bottom line and being met by a rise of over 5% in its stock so far this morning. At the other end of the index Informa has declined by more than 7% after the information company launched a rights issue.

GBPUSD falls back below 1.23

The pound has dropped under the 1.23 handle against the US dollar once more this morning as the UK currency continues to depreciate. Following the flash crash seen overnight on Thursday the subsequent failure to recoup the losses, there are suggestions that comments believing it to have been caused by a fat finger are wide of the mark and there is more to it than just an erroneous trade. Yesterday’s level on the US close was the lowest so far this year and this morning we’ve seen more downside with the newest member of the MPC stating that he would not be surprised to see sterling fall further. Michael Saunders made several dovish comments before a Treasury select committee which will do little to offer a lifeline to the pound, also declaring that negative rates should be kept on review and that downward pressure on wages is more evident.

Latest comments

"Pound continues it's demise.". . Your article is looking pretty silly an hour later.
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