Sterling rises for a second day as central banks turn dovish

Wednesday,   19-Jun-2019   03:48 PM (IST)

The pound edged higher for a second day on Wednesday, breaking a six-week losing streak, as investors trimmed some large short bets against the British currency built up in recent weeks. The pound has fallen by 5% since early May, as concern grew that arch-Brexiteer Boris Johnson, the top contender to become the next British Prime Minister, will lead the country out of the European Union with or without a deal by Oct. 31. But a dovish tilt by global major central banks, including the U.S. Federal Reserve and the European Central Bank, has lifted some of the gloom over the British currency. On Wednesday, the pound rose 0.2% to $1.2583, up from Monday’s five-month low of $1.2507. Versus the euro, it gained to 89 pence. Bank of England policymakers have said that interest rates may need to rise sooner than markets expect, but traders are in no hurry to shift their expectations.