Strong pound pushed FTSE 100 down on Tuesday morning
The pound hit its highest level against the dollar since the Brexit vote in June 2016, rising to $1.4364 by mid-morning.
Sterling’s surge has been attributed to optimism ahead of wages and unemployment data, released on Tuesday morning, weakness in the dollar, and reduced concerns around the possibility of a hard Brexit as the UK and EU get ready for the next round of negotiations.
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The strong pound pushed the FTSE 100 down by three points at the open.
Naeem Aslam, chief market analyst at Think Markets, said: “Traders have pushed the currency higher ahead of the important upcoming wages and unemployment data, perhaps there is a real optimism amidst them.
“We do think it is a bold move because most of the bets are based on the hopes that the health of the job market would permit the Bank of England to adopt a more aggressive stance towards their monetary policy. If the numbers do show that the wage data has the ability to outperform the strength in the inflation, it would firm the bullish bets on sterling.”
The pound also made slight gains against the euro, rising 0.03 per cent to €1.1585.