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Sterling hits 10-week high
Sterling hit a 10-week high against the US dollar this morning (15 July) rising 0.65 percent to $1.5362.
The rise occurred as JP Morgan & Chase’s corporate earning reports beat expectations and helped to lift equity markets.
Earnings per share in for the second quarter of the year came in at $1.09, compared with forecasts of $0.71.
Tiffany Burk, European market analyst at Travelex Global Business Payments said the lift was due to improved risk appetite and Pimco's increased optimism in investing in Britain after it said it was reversing its decision to cut its holding of UK debt.
She said: "However, despite recent gains, I think risk appetite will be short-lived and sterling may fall back as the $1.54 mark approaches. I expect to see substantial resistance to further improvements, especially when looking towards next week’s agenda.
"Nervousness over the UK release of quarter two gross domestic product data may prompt a round of profit taking in long sterling positions.
"With Europe looking towards the results of the bank stress tests, risk appetite may dry up, as criticism of the process is likely to run high.
"This will temper the optimism we saw this week in the Eurozone, after Greece, Spain and France saw good demand for freshly issued debt."
