The British Pound looks to recoup some of its losses against the Australian Dollar and the New Zealand Dollar.
The Pound Australian Dollar FX rate is higher by 0.130% with 1 GBP = 1.6439 AUD at 9am.
The Pound New Zealand Dollar FX rate is higher by 0.338% with 1 GBP = 2.1140 NZD.
Pound Australian Dollar rate
According to analyst's at FX brokers Caxton Fx the British Pound fell steeply against the Australian dollar yesterday, dropping over two cents as the market prices in another interest rate rise.
"The Aussie made strong gains across the board after data from Australia showed a rising rate of consumer inflation, almost confirming that the central bank will raise rates next month," reads an analyst comment on the FX rate.
The strong yield that is attracting investors to Australia is doing a good job of supporting demand for the currency even whilst developments in the eurozone lead to rising risk aversion.
Conditions in Europe are proving damaging for the British Pound though. The UK's economic recovery will of course be directly impacted should the eurozone, Britain's largest trading partner, fail to resolve the situation.
Pound New Zealand Dollar rate
In a similar fashion to sterling/aussie, the pound fell sharply against the kiwi yesterday, touching a one-month low.
The New Zealand dollar has come under selling pressure this morning though as the positive statement from the central bank that was being priced in yesterday failed to appear.
As expected, the RBNZ left rates unchanged at 2.50%, but sounded a less hawkish tone in their accompanying statement.
The Bank said that interest rates need not rise too far when it starts to tighten policy.
Although the door was left open for a rate rise anywhere between June and September, investors had hoped for more definitive signals of a rise in June.
