Sterling loses Ground Against AUD And NZD Following UK Halifax House Price Survey, GBP EUR Exchange Rate Up

Published: Monday, 7 January 2013 14:00 BST - Written by James Fuller

STORY LINK Sterling loses Ground Against AUD And NZD Following UK Halifax House Price Survey, GBP EUR Exchange Rate Up

This morning brought more glum news for UK economic participants in the form of the latest Halifax House Price survey. The closely-watched gauge of the state of Britain’s housing sector concluded that the average UK house price dipped by 0.3% during 2012. The market is expected to remain subdued throughout this year, with no alteration to the average price of a British property anticipated. Halifax added to the feeling that the UK’s economy remains directionless by observing that the prospects for Britain’s economy was more uncertain than was normally the case.

The pound has lost ground on the day against the high-yielding commodity-driven currencies, meaning that the Pound Australian Dollar exchange rate (currency : GBP AUD) edged down to 1.5278 earlier, while the Pound New Zealand Dollar rate (currency : GBP NZD) slumped to 1.9185 in early trading today.

However, Sterling has registered a healthy gain against the euro on the day, sending the GBP EUR exchange rate (currency : GBP EUR) as high as 1.2326 in the middle part of the session. The move was fuelled by euro weakness, rather than by any support for the Pound, following the release of whole of eurozone Producer Price Index numbers earlier. The data revealed that the rate of price rises of goods leaving the region’s factory gates is at a lower level than had been expected. The PPI release is considered by economists to be a significant leading indicator of future levels of inflation in an economy. For this reason, today’s figure suggests that the European Central Bank will have scope to further loosen its monetary policy as 2013 progresses, heaping pressure on the single currency.

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