Jan
23
POUND
Sterling is trading stronger against the USD this morning and is staying relatively stable against the Euro within the 1.19 region. Most recent economic data has been flat with retails sales data out as expected at 0.6%. Market sentiment has improved towards riskier assets but further gains may well be hampered by concerns over the fragile state of the UK economy. There is some speculation of foreign investment flows are aiding the pound with China’s sovereign wealth fund taking a stake in Thames water. The outlook for sterling remains shaky with inflation now lower, the BoE has more room to manoeuvre on quantitative easing in order to starve off the ongoing threat of another UK recession. <