Pound stronger on news, house price data

Pound stronger on news, house price data

Story link: Pound stronger on news, house price data

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The pound made gains Tuesday on the possibility that the political situation in the UK is stabilizing after Prime Minister Gordon Brown seemed to have ridden out calls for his resignation after losses in recent local elections and recent resignations of several ministers.

According to reports, Mr. Brown agreed during a meeting with members of the Labour Party to certain changes in his goals and leadership style in exchange for the continued support of his party.

Additionally, the pound was helped by a new report from the Royal Institution of Chartered Surveyors said that just 44.1 percent more estate agents said home prices fell last month than reported gains in prices, the best result in just over a year and a half.

At just after 11 a.m. in New York, the pound traded at 86.1p to the euro while it took $1.6258 to buy a pound and the yen traded at ¥158.6084 to the pound.

Meanwhile, the US dollar weakened as signs that the recession is easing reduced demand for the greenback.

Goldman Sachs (NYSE: GS) recommended that clients buy the euro rather than the dollar, saying that US interest rates, set by the Federal Reserve, are likely to remain low for the foreseeable future despite speculation that the Fed could raise rates after fewer US jobs were reported lost in May by the Labor Department.

In late morning trade in New York, the dollar traded at $1.3998 to the euro, while the yen traded at ¥136.5622 to the euro and at ¥97.56 to the dollar.