Momentum carries Sterling over key 1.15 Euro barrier
As predicted, the Pound has been given that extra push to break the psychological barrier of 1.15 against the Euro. UK inflation figures released this morning showed a small increase of 0.1% in January which was above expectations. This marks the first step towards the BoE's 2.0% target rate by early 2022. The hope now is for the Pound to consolidate the position and allow for more gradual gains in the coming weeks/months.
Data-house Capital economics, have today suggested that the Pound will hit £-€1.17 & £-$1.45 by the end of the year. The way things are going, I would say this is a pessimistic target range, seeing as all analysts are expecting the economy to bounce-back strongly in the summer. Nevertheless, it's good to see these positive figures being forecast and it will only add to the optimism surrounding the UK & £ at the moment.
£-$ rates fell away from its target of 1.40 yesterday, after bullish comments from Fed suggesting the US economy is in a 'generally good state'. This was reinforced by better than expected manufacturing data, showing an upbeat picture. There may be more $ strength to come with retail sales and the FOMC meeting later today.
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