GBP/SEK is advancing in early trading on Tuesday, after losing 0.57% yesterday.
Currently, the pair is displaying a rate of 12.6278, up 0.22% as of 6:20 AM UTC.
Pound sterling supported by economic data
The British currency is supported by a series of economic data that confirms an increase in consumer confidence after the December election won by Prime Minister Boris Johnson.
Yesterday, property site Rightmove said that asking prices for houses put on sale had continued to rise. The price of property units put on sale between January 12 and February 8 increased by 0.8% on the month, slower than a 2.3% surge in the previous report. Nevertheless, the prices got closer to their record high.
The number of agreed sales jumped by 12.3% year-on-year and by 26.4% in London alone.
Rightmove director Miles Shipside commented:
“It’s the first time for over a year that we have seen any sign of a return of seller confidence, albeit lagging behind the surge in numbers of early-bird buyers.”
Separately, IHS Markit said that its measure of how UK citizens feel about their finances rose to a record high in February. The household finance index surged to 47.6 from 44.6 in January, which is the highest reading since the poll started 11 years ago.
IHS Markit economist Joe Hayes stated:
“Our latest Household Finance report signals a number of developments that should keep the Bank of England doves at bay and build optimism towards the UK’s immediate economic prospects.”
The report showed that consumers expected inflation to slow while house prices to continue their growth. Despite an increase in confidence, the proportion of households expecting a rate cut by the Bank of England increased to 27%, which is the highest since 2016.
Besides the economic updates, the sterling might also be supported by the recent comments made by Johnson’s Europe adviser David Frost. He said that Britain wouldn’t be threatened into abiding by European rules in the upcoming trade negotiations given that it doesn’t ask anything special. Frost stated:
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“We are not frightened by suggestions there will be trade frictions. We are not asking for anything special, we are asking for a simple free trade agreement.”
However, it seems that Europe will insist on its rules indeed. We reported that France’s foreign minister had warned that Britain and Europe would rip each other apart in the trade talks.