TOKYO, (APP/AFP) – The pound rose Thursday ahead of a
meeting of the Bank of England as it mulls an interest rate cut to counter the fallout from Britain’s vote to exit the European Union.
Sterling picked up to $1.3223 from $1.3144 in New York as markets
await the outcome of the central bank’s first meeting since last month’s referendum.
The shock decision to exit the 28-member bloc led BoE chief Mark
Carney to say “some monetary policy easing will likely be required over the summer”.
A rate cut would be the bank’s first in seven years.
In other trading, China’s yuan dropped to its lowest in nearly six
years on the back of weak trade data that stirred worries about the world’s number two economy.
The unit was at 6.6878 against the dollar Thursday morning, according
to the China Foreign Exchange Trade System. That is just off levels last reached in November 2010.
“All eyes are on China’s economic data for the second quarter — if
the numbers turn out to be weak, the yuan may depreciate beyond 6.7 per dollar,” Andy Ji, a foreign-exchange strategist at Commonwealth Bank of Australia, told Bloomberg News.
Meanwhile, the dollar climbed to 105.33 yen from 104.52 yen Wednesday
in New York.
The euro was at $1.1120 and 117.11 yen against $1.1089 and 115.90 yen
in US trade.
Many investors were keeping to the sidelines as they await more news
on possible stimulus packages, including one that Japan has promised to boost stumbling growth.
A lack of news “appears to have taken the wind out the market’s
sails,” National Australia Bank said in a commentary.
“Expectations of stimulus need to be backed up with some action and
now the risk of disappointment is starting to rise.”
Emerging market currencies broadly rose against the dollar including
the South Korean won which tacked on 0.75 percent after its central bank kept its key interest rate unchanged at a record low 1.25 percent, as the country’s growth outlook struggles.
APP/AFP/gar