Sterling strengthens on rising house prices

Sterling strengthens on rising house prices

Story link: Sterling strengthens on rising house prices

TAGS:

The yen weakened further on Monday as fallout continued from last week’s decision by the Bank of Japan to leave interest rates at 0.25 percent for the time being. Investors continued to finance long positions in higher-yielding currencies by selling the relatively low-yielding yen, with record levels of short yen positions on the New York Mercantile Exchange reported for the week ending January 16.

Comments from the secretary-general of Japan’s ruling Liberal Democratic Party were widely seen as supporting what is seen as interference in the Bank’s monetary policy decisions that analysts regard as not a good thing for the Japanese economy. The secretary-general called for “a framework” in which the Bank would be called upon to “align” its policy goals with the goals of the government before it makes policy decisions. The comments did not help the strength of the yen.

The yen dropped 0.2 percent to ¥157.50 versus the euro, while it fell 0.3 percent to ¥121.60 against the US dollar and was 0.5 percent lower in relation to sterling, to ¥240.40.

Sterling was also stronger in relation to the greenback and the euro as new data indicated that house prices in the UK are growing at their most rapid pace since October 2004. The UK currency added 0.2 percent versus both the shared currency and the dollar, to £0.6550 and $1.9770 respectively.

The Swiss franc was weaker against both the dollar and the euro, dropping 0.1 percent in relation to both, to trade at SFr1.2490 against the dollar and at SFr1.6190 versus the euro. Meanwhile, the dollar held steady against the euro at $1.2955.