Sterling hits a 7 week high against the Euro
Sterling exchange rates spiked to a 7 week high against the Euro yesterday as Ireland was firmly back under the spotlight after it emerged from EU sources that discussions of a bailout for the country were well underway.
This morning we have seen further gains as inflation figures for the UK have risen to 3.2% well above the Bank of England’s target level of 2%. This will lead to speculation that the BoE could raise interest rates at some point next year and probably reduces the chances that the MPC will initiate another bout of QE.
If we continue to see high inflation into the early part of next year I would not be surprised to see GBP-EUR hovering above 1.20.
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