The pound rose to the strongest level in seven weeks versus the euro amid speculation Bank of England minutes tomorrow will show policy makers are moving closer to raising borrowing costs.
Sterling approached the highest in more than four years against the dollar amid signs Britain’s economy will continue to expand at a faster pace than that of the 18-nation currency bloc. Standard Bank Plc recommended investors buy the pound versus the Swiss franc and the New Zealand dollar. U.K. government bonds declined for a third day, with the yield on two-year gilts climbing to the most since July 2011.
“The pound will trade higher versus the euro over time,” said Gavin Friend, a foreign-exchange strategist at National Australia Bank Ltd. in London. “The strength of the U.K. data is driving this. We think we’re on for something like 0.9 percent growth in the first quarter, well above the U.K.’s peer countries and that will just keep the pound supported.”