The sterling saw mixed results in trading against the other majors. The pound gained against the struggling dollar, but dropped against the yen and euro. With little economic news out of the UK, traders also continued to digest the Bank of England's Monetary Policy's decision Thursday to maintain its benchmark interest rate at 5.75% for the second straight month.
The pound moved to its highest level in almost a month against the U.S. dollar on Friday in New York. The sterling soared ahead of resistance after a weak jobs report in the U.S. and hit as high as 2.0319, its best mark since August 8. The pound cooled back to 2.0279 in the mid-afternoon with a downward trend. The report showed that non-farm payrolls fell by 4,000 jobs in August following a downwardly revised increase of 68,000 in July. Economists had expected an increase of about 110,000 jobs compared to the increase of 92,000 originally reported for the previous month.
The sterling declined against the euro on Friday in New York and hit a 10-day low. The British currency dropped sharply starting at around 6:45 a.m. ET and continued to do so until it reached as low as 0.6798 at 11 a.m. ET. It rallied slightly in the late morning before stabilizing in the afternoon. Traders considered a report showing German employers in the industry and the service sector saw a seasonally adjusted annual increase of 0.9% in labor costs in the second quarter of 2007. Meanwhile, a second report revealed German insolvency courts witnessed 82,702 insolvencies during the first half of 2007, up 9.0% year-on-year.
The pound saw weakness against the yen on Friday in New York. The sterling declined starting at around 8:30 a.m. ET and eventually reached as low as 229.12. Trading took place after Japan's Ministry of Finance said Friday morning that the nation's foreign reserves rose to $932.157 billion at the end of August from $923.718 billion at the end of July.
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