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Pound downgrading although house prices in UK rose in May
The house prices in the U.K. rose in May as expected. Meantime the US Dollar firmed against most major currencies. As a result the Pound is currently downgrading against the greenback which is still seen as a safer currency among buyers.
Dollar firms out against major currencies – safe haven for investors while Euro under pressure on Spain’s and Greek economic troubles
Disappointing economic data such as low job reports, poor economic growth rates and more led to talks that the Federal Reserve may apply quantitative easing this month. At the moment, however, the US Dollar stabilized against most major currencies.
The Euro, on the other hand, is still under pressure due to the ongoing concerns related to Spain’s troubled banks and the upcoming elections in Greece. As a result, investors still see the Dollar as the safer currency at the moment, which is why the Euro is currently downgrading.
Euro up against the Pound despite ongoing concerns over Spain and Greece
Despite concerns over Spain’s banking problems and unclear outcome from the Greek elections, and the high house prices in the UK in May, the Euro still managed to gain against the Pound at the moment.
Sterling downgrading despite positive news about rising house prices in UK
The major news from UK is related to the house prices which rose for the month of May. Martin Ellis, Halifax housing economist, explained “We expect this situation to continue with prices likely to still be around today's levels at the end of 2012 as the ongoing tough economic environment constrains housing demand.”
Meantime, Spain continues to suffer due to its troubled banks, and it’s still not clear what would happen to Greece after the elections later this month. The single currency, however, managed to upgrade against the sterling despite all economic troubles in the euro zone at the moment.