The sentiment remained mixed in the market as this week comes to an end, where after finance ministers announced that Greece will reach a final agreement next week, markets reversed to the downside as Greek officials disappointed investors more than once, where they failed to meet any deadline so far and postponed debt-talks several times, which added stress and tension to the markets, which are still waiting for more details over the Greek situation.
The European common currency declined sharply today after the announcement; however, the euro recovered some of the losses against the U.S. dollar, which is weakening now due to the strengthening pound, which was affected sharply by inflation data, which have beaten expectations, adding upside pressures on the royal currency.
The United Kingdom released the producers' price non-seasonally adjusted indexes for January, where the monthly PPI input, which measures the changes in prices of raw materials that are used in the manufacturing process, expanded beyond expectations by 0.5% from the prior drop of 0.6%.
Furthermore, the monthly PPI output, which measures the changes in prices of finished goods manufactured by factories, climbed by 0.5% from the previous drop of 0.2%, adding more pressures on inflation to climb after it declined in the previous month.
Yesterday, the Bank of England left rates unchanged at 0.5% in order to support growth and recovery, while adding more stimuli to support the economic activity, where the bank added another round of easing worth 50 billion pounds. Therefore, and as we all know low rates and further easing don’t control rising inflation; however, the bank projects inflation to undershoot the 2% target over the medium-term, then in result we must wait for the coming inflation report for more details.
The sterling pound recorded gains against the U.S. dollar after the news, where the GBP/USD pair is currently trading around $1.5837, after recording the highest at $1.5842 and the lowest at $1.5766, noting that the pair started the session at $1.5814.
However, after the news the British FTSE 100 index was 0.24% or 14.06 points lower, trading now around 5881.21 point, led by the basic material sector, which shed 1.27% so far, while in terms of single shares ICAP plc declined the most today, cutting 3.78% to trade around 367.00 pound per share.
The European common currency declined sharply today after the announcement; however, the euro recovered some of the losses against the U.S. dollar, which is weakening now due to the strengthening pound, which was affected sharply by inflation data, which have beaten expectations, adding upside pressures on the royal currency.
The United Kingdom released the producers' price non-seasonally adjusted indexes for January, where the monthly PPI input, which measures the changes in prices of raw materials that are used in the manufacturing process, expanded beyond expectations by 0.5% from the prior drop of 0.6%.
Furthermore, the monthly PPI output, which measures the changes in prices of finished goods manufactured by factories, climbed by 0.5% from the previous drop of 0.2%, adding more pressures on inflation to climb after it declined in the previous month.
Yesterday, the Bank of England left rates unchanged at 0.5% in order to support growth and recovery, while adding more stimuli to support the economic activity, where the bank added another round of easing worth 50 billion pounds. Therefore, and as we all know low rates and further easing don’t control rising inflation; however, the bank projects inflation to undershoot the 2% target over the medium-term, then in result we must wait for the coming inflation report for more details.
The sterling pound recorded gains against the U.S. dollar after the news, where the GBP/USD pair is currently trading around $1.5837, after recording the highest at $1.5842 and the lowest at $1.5766, noting that the pair started the session at $1.5814.
However, after the news the British FTSE 100 index was 0.24% or 14.06 points lower, trading now around 5881.21 point, led by the basic material sector, which shed 1.27% so far, while in terms of single shares ICAP plc declined the most today, cutting 3.78% to trade around 367.00 pound per share.
