Forex - EUR/GBP extends gains after U.K. borrowing rises to record
Investing.com
Published May 24, 2011 05:19AM ET
EUR/GBP hit 0.8743 during European morning trade, the pair’s highest since Friday; the pair subsequently consolidated at 0.8730, gaining 0.20%.
The pair was likely to find support at 0.8663, Monday’s low and a two-month low and resistance at 0.8837, Friday’s high.
The Office for National Statistics said public sector net borrowing totaled GBP7.71billion last month, around GBP2.5 billion higher than the same month last year and the highest reading for a month of April on record.
Economists had expected public borrowing to reach GBP5.0 last month.
The single currency found support after data showed that German business confidence remained unexpectedly unchanged in May as rising exports and increased company spending boosted economic growth.
The Ifo institute said its business climate index held at 114.2 from April. Economists forecast a decline to 113.7.
The euro was also higher against the U.S. dollar, with EUR/USD gaining 0.23% to hit 1.4080.
Earlier in the day, rating agency Moody's said that it may cut its rating on 14 British lenders, including Lloyds and Royal Bank of Scotland, because U.K. regulators appear less willing to bail out banks in the future.
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Written By: Investing.com
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