GBP decoupling from UK's housing sector - BTMU

By FXstreet.com | July 10, 2014 AAA

FXStreet (Barcelona) - Derek Halpenny, European Head of Currency Strategy at the Bank of Tokyo Mitsubishi UFJ, does not consider the housing sector a catalyst for a weaker pound,



Key Quotes



"The BOE rate announcement is due today with no change expected. The RICS data early this morning did indicate that perhaps the recent upturn in speculation of rate increases may well be dampening housing activity, particularly in London."



"The overall RICS house price balance fell three points to 53. The balance in London fell to 31, the lowest in a year as buyer enquiries were outstripped by new houses coming on to the market."



"New macro-prudential steps introduced in April and the news of new steps announced by the FPC in June are likely having an impact. We don’t think a cooling in housing will have a major impact on the pound. The broader economy is surging and while housing is playing a role, it is not the key determinant – so any declines for the pound on housing news are unlikely to last."



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