UK property sector influences strength of Pound

  • 13 years ago
  • Uncategorized

The Pound has been making back ground following the steep drop bought on by the surprise contraction in GDP figures on Tuesday. Yesterday’s Bank of England minutes indicated that policymaker Martin Weale joined Andrew Sentence in voting for a 0.25 percent interest rate rise which will have aided Sterling slightly.

However an interest rate rise was not ear marked until August in the MPC minutes, which will serve to dampen some of the recent hype for an earlier increase which has pushed Sterling upwards. It is also significant that these were the minutes from two weeks ago coming before the shockingly low GDP figures – so the impact of GDP has not yet been dissected by the Bank of England but will come in the next meeting and set of minutes in February.

Weakness in the property sector has reared its head once more with a Hometrack housing report for December indicating a drop in house prices by 0.5 percent in December – a drop for the seventh month in a row.

 

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