LONDON (SHARECAST) - The dollar endured a tough session as data took the euro to its highest against the greenback in almost three months, while sterling hit a new five-month best.
Decent company earnings got the single currency off to a flier, with the rally on equity markets boosting risk appetite.
There was also a report that credit rating agency Moody’s had warned America’s AAA rating could come scrutiny without a credible fiscal consolidation plan.
A better than expected eurozone economic confidence indicator also helped, up to 101.3 from 99 previously, beating forecasts for a read of 99.1.
Recent second quarter GDP data and July CBI retail sales continued to fuel the pound’s march north. It even managed to shrug off weaker than expected mortgage approvals and a fall in house prices.
Loans approved for house purchase dropped to 47,643 in June, down from 49,461 in May and well below the average for the past six months of 50,036.
Meanwhile, Nationwide said UK house prices fell by 0.5% in July to £169,347.
“A combination of restrictive credit conditions and uncertainty about the future economic outlook continues to limit the pool of buyers to those with relatively large financial resources,’” said the building society’s chief economist Martin Gahbauer.
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