The sterling has finally broken a 26 year old exchange record by briefly trading at a rate of £1 to $2.01. Interesting how it has really almost gone unnoticed.
Signs now point to the Bank of England raising rates when its policy committee meets next month. The strength of the pound bodes well for British tourists, but undoubtedly represents a threat for any British industry that relies on exports.
Most certainly the strength in the pound can be seen as a sign of investors faith in Europe's growth. At the same time, will the weakness in the dollar be the reawakening of exports?
Wednesday, April 18, 2007
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