The Pound Is The Euro Without Greece

Sterling is up against the euro but down against the dollar amidst a flurry of data this morning.

The release fo the BoE minutes from the MPC's meeting earlier this month revealed a unanimous vote to hold interest rates at a historic low of 0.5%, in addition all nine members of the committee members voted not to increase QE.

They did note that part-time working had increased during the recession and that there was a risk that the jobs market "could deteriorate further."

Other data showed that unemployment fell slightly to 7.8% from 7.9% in the three months ending November (compared to the three months ending October), but underlining the MPC's concerns about jobs were figures revealing that full time employment fell by 113,000 during the period.

The mixed data further muddies the waters as far as any potential interest rate rises are concerned, following on from yesterday's news that inflation has risen to 2.9%.

MPC member Andrew Sentance last week said that he thought that a rise in UK interest rates was not out of the question later this year, and the inflation news seemed to support the chances of that.

However a shaky jobs market would undermine the economic recovery, such as it is, and reduce the chance of any rate rises.

Regardless of all that, the news from Euroland is worse at the moment, with the prospect of a Greek bailout haunting the single currency. The pound has popped up to 1.15 against the euro despite the mixed picture for the UK. That's the first time the pound has been up there since 24th August 2009.

One comment I read yesterday went something like "the pound is the euro without Greece". Which sums things up quite nicely I think.

Against the dollar the UK currency is a little easier at around 1.6270, roughly in the middle of a fairly broad sideways trading range that has been in place since last May.