Euro / Sterling update

Sterling held at its lowest level in more than 11 years on a trade-weighted basis first thing this morning as expectations for interest rate cuts mount and confidence in the banking sector and wider economy ebbs. Pay settlements held steady in February indicating that building price pressures are not yet feeding through to wages, a survey from the consultancy Industrial Relations Services said on Thursday. Minutes from the Bank's Monetary Policy Committee on Wednesday showed that Deputy Governor John Gieve unexpectedly joined David Blanchflower in voting for a cut in interest rates in March, heightening expectations of an imminent cut. In further gloomy news for the pound, B of E policymaker Kate Barker said the credit crisis is making it more difficult for Britons to buy houses and affordability is unlikely to improve. However positive UK Retail data just out has moved Sterling up 0.6% against the Euro. Right now Interbank is at 1.2774 with Natwest offering 1.2115. Have a good Easter holidays. Source: IFX