Euro vs UK Sterling (FX:EURGBP)
2 Years : From Dec 2011 to Dec 2013
In early European deals on Thursday, the pound advanced against other major currencies despite a report showed that the U.K. trade deficit widened in February.
The UK's visible trade gap increased in February and exceeded economists' expectations, data from the Office for National Statistics showed.
The deficit on seasonally adjusted trade in goods was GBP 8.8 billion in February, compared with a revised GBP 7.9 billion deficit in January. Economists expected a deficit of GBP 7.65 billion, higher than January's previously estimated shortfall of GBP 7.53 billion.
The deficit on trade in goods and services was GBP 3.4 billion in February, higher than GBP 2.5 billion in January. Expectations were for a shortfall of GBP 2 billion.
Investors now await Italian bond auction results for signs of stability in the euro zone.
The pound that closed yesterday's deals at 128.65 against the yen and 1.5909 against the greenback reached a 2-day high of 129.38 and a 9-day high of 1.5958, respectively. The next upside target level for the pound is seen at 130.00 against the yen and 1.60 against the greenback.
Bank of Japan Governor Masaaki Shirakawa today said that the central bank will continue powerful monetary easing and warned that uncertainty over global economy still remained high.
In a speech at a quarterly meeting of the central bank's regional branch managers, Shirakawa said the BoJ will pursue powerful easing to help the economy overcome deflation and return to a sustainable growth path.
Against the euro and the franc, the pound approached a new 3-month high of 0.8229 and a fresh 4-week high of 1.4618 from yesterday's close of 0.8243 and 1.4597, respectively. If the pound gains further, it may target 0.815 against the euro and 1.47 against the franc.
Eurozone inflation is expected to stay above 2 percent in 2012, with upside risks prevailing, the editorial to the European Central Bank's monthly bulletin showed.
Over the policy-relevant horizon, the ECB forecasts price developments to remain in line with price stability.
The U.S. PPI for March, trade data for February, weekly jobless claims for the week ended April 7, Canada trade data and new housing price index for February are expected in the New York morning session.