GBP/USD Falls as Risk Aversion Rules Market
The Great Britain pound declined today versus the US dollar as the uncertainty about the outcome of the European Union summit made traders prefer safer currencies, shunning the sterling that is also weakened by the problems in Britain itself.
The leaders of the EU are meeting today at the summit to discuss the problems of the region. Among the discussed issues is the voluntary participation of banks in rescuing Greece and other indebted economies, though rumors say a forced involvement isn’t out of question. There are words that the politicians were divided in their opinion about the idea of incurring losses on bondholders and the discussion of this matter was postponed. The signs of disagreement among the European chief are hurting market sentiment and that translates to the pound. The economy of the UK is rather dependent on continental Europe and the bad news from the EU is bad for the nation’s economy and currency.
GBP/USD fell from 1.5998 to 1.5964 as of 19:58 GMT today, following the earlier decline to 1.5889. Meanwhile, EUR/GBP rose from 0.8688 to 0.8705.
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Earlier News About the Great Britain Pound:
- GBP Higher Against USD -- For Now (2011-10-24)
- UK Borrowing Shrinks, While Consumer Confidence Deteriorate (2011-10-21)
- Pound Climbs After BoE Minutes (2011-10-19)
- UK Pound Lower on Stagflation Worries (2011-10-18)
- Pound Higher Against Dollar, Down Against Euro (2011-10-14)