Exchange Rates: Best UK Services Data In 16 Years Sends Pound to Euro, US Dollar & Australian Dollar Soaring

Modified: Tuesday, 5 November 2013 15:59 BST - Written by David Woodsmith

STORY LINK Exchange Rates: Best UK Services Data In 16 Years Sends Pound to Euro, US Dollar & Australian Dollar Soaring

The Pound has traded into positive territory against nearly all of the other majors so far today following a strong UK data print. Elsewhere, last night’s Reserve Bank of Australia policy decision was accompanied by a surprising statement – the GBP AUD exchange rate climbed in response.

The Pound to Euro exchange rate (GBP/EUR) is currently trading up by 0.74% at 1.1905 GBP/EUR. The Euro to Pound exchange rate is currently trading at 0.8400 EUR/GBP.

A stellar Sterling data set, published earlier today, has seen the Pound register healthy gains against all of the other major currencies. The Pound euro exchange rate (GBP/EUR) broke through the 1.1900 barrier a short time ago following the release of the latest Purchasing Manager Index survey of Britain’s all-important services sector.

With the combined tertiary industries comprising over three quarters of all economic activity in Britain’s economy, the showing of 62.5, which was well ahead of analysts’ expectations of a showing of 60.0, sent Sterling skywards. The figure indicated that growth in the services sector stands at its highest level since 1997, providing the Pound with a major fillip moving forward. If the move northwards persists for GBP EUR then last month’s 9 ½ month high just above the 1.2000 threshold could be the next stop for the pair.

Elsewhere, last night’s Reserve Bank of Australia’s overnight decision to maintain its key registration rate at its current record low of 2.50% surprised no-one. However, the tone of the rhetoric contained in the RBA’s accompanying statement was slightly more bullish than in previous months. Australia’s central bank noted that the full benefit of the trimming of interest rates during the first part of this year is still filtering through to the real economy in Australia. RBA Governor Glen Stevens backed up these comments by observing that ‘the setting of monetary policy remained appropriate’, suggesting that his bank’s rate cutting cycle may now be at an end. In spite of this, the GBP AUD exchange rate has climbed on the day, touching 1.6937 earlier.

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