Pound Strengthens on House Prices Climb

The pound started the week climbing versus the yen and the dollar, as stocks rose and the house prices in the U.K. had an increase in the month of June, raising attractiveness for the British currency.

The British currency advanced versus the yen reversing a negative trend from last week’s end as the CIT Group Inc. quarterly earnings are expected to be significantly positive, creating speculations that one of the biggest financial groups in the world will not file for bankruptcy as previously stated by some economists. Rightmove Plc, one of the leading British companies in the housing sector reported that house prices in the U.K. rose 0.6 in July after posting a drop of 0.4 in the previous month, adding optimism that the real estate market sector is rebounding in the U.K., consequently attracting investors to purchase pound-priced assets.

Analysts identify the weekend financial news as a support for the pound to rise this Monday, but it is uncertain how long this movement will last, since the scenario is still far from optimal for the British economy. Currencies like the yen and the dollar witnessed a significant fall versus all higher-yielding currencies due to a rise in risk appetite, and the pound was favored by this trend among most of the currency trading community.

GBP/USD traded at 1.6505 as of 10:16 GMT from an opening price of 1.6355. GBP/JPY traded at 155.95 from 153.88.

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