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Euro Weakens as Le Pen Wins Latest Poll

• Posted by Shyam Gokani in Bank of England, Brexit, Currency, Dollar, Economy, EUR, GBP, Inflation, Mark Carney, Prime Minister, Retail Sales, Sterling, UK, Uncategorised
• February 22, 2017
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Sterling rose almost 1 percent against the euro today, to its highest in two months, after another opinion poll showing far-right French presidential candidate Marine Le Pen gaining ground hit the single currency.

The poll suggests anti-EU nationalist Le Pen may have more chance of springing a surprise if she makes it through to the second round of the elections in May.

Also, the closer a French populist shock to follow last year’s U.S. presidential and Brexit votes becomes, the more the pound will begin to look like a safe haven, dealers say.

The threat of politician Marine Le Pen winning the election … has sparked jitters.

Sterling traded flat on the day against the dollar after a rollercoaster ride which earlier saw it threaten another fall below $1.24.

There was a measured message from Bank of England Governor Mark Carney and a group of policymakers testifying in parliament, who defended the bank’s low interest rates but also noted rising inflation.

The U.K. economy grew more than previously estimated in the final three months of 2016 but it may be the last.

Gross domestic product rose 0.7 percent instead of 0.6 percent. It followed growth of 0.6 percent in the previous two quarters. Trade and consumer spending provided the biggest contributions as business investment fell.

The upward revision to the fourth quarter was largely due to manufacturing. Services grew an unrevised 0.8 percent. The sector expanded 0.2 percent in December, similar to the pace of the previous two months.

GDP rose 2 percent in the fourth quarter from a year earlier, revised from a previous estimate of 2.2 percent.