BLBG: British Pound Advances to One-Year High Versus Euro on Sovereign Crisis
The pound rose to the highest in almost a year against the euro as the cost of insuring Spanish bonds against default jumped on concern the region’s debt crisis is worsening.
Sterling advanced for the first time in three days against the single European currency. Credit-default swaps on Spain jumped 20 basis points to 425 as El Pais reported the government had to help the Valencia region make a 123 million euro ($160 million) payment to Deutsche Bank AG.
“The debt crisis is still a key issue that undermined the euro,” said Lee Hardman, a currency strategist at Bank of Tokyo-Mitsubishi UFJ in London. “It’s the euro weakness rather sterling strength.”
The pound climbed 0.6 percent to 82.90 pence per euro, the the strongest since Jan. 10, 2011, before trading at 82.96 pence at 2:41 p.m. London time. Sterling fell 0.2 percent to $1.5620 and 119.89 yen.
To contact the reporter on this story: Anchalee Worrachate in London at aworrachate@bloomberg.net;
To contact the editor responsible for this story: Daniel Tilles at dtilles@bloomberg.net
