Sterling performing well as euro dips

Published: 23 Apr at 8 AM Tags: Euro, Dollar,

Positive housing data in the US has helped to support the dollar as well as boost bond yields. The dollar index, an indication of how the greenback is faring against a basket of other world currencies, extended to 98.270, a gain of 0.3 per cent. The dollar has become attractive to investors ahead of plans by the Federal Reserve to hike interest rates.

Although the dollar has suffered some negative economic reports in recent weeks, the homesales data published this week has helped to allay fears that the economy may be softer than expected.

Concerns about Greece’s ability to secure fresh funding deals have helped push the euro down to $1.0693, a dip of 0.3 per cent. Earlier this week the single currency fell as low as $1.0660. Although there has been some progress in Athens, the general opinion is that cash-strapped Greece is heading for default.

Elsewhere the New Zealand dollar lost around 1 per cent to end at $0.7591. The kiwi suffered an announcement by the Reserve Bank of New Zealand that interest rates would not rise until there was solid proof of increased inflation.

The possibility of higher inflation has helped push sterling as high as $1.5080, its best performance in a month.