British Pound Climbs as House Prices Rebound

The pound sterling rallied against the dollar and the yen after a report on house prices revealed an unexpected rise in May, boosting confidence among investors that the real estate crisis may be easing.

The excellent news for the United Kingdom currency revived hopes for this European nation, one of the most hit by the global crisis and the credit crunch. A report on consumer confidence this month showed the highest level in almost a year, reversing a trend of extremely low marks, adding to that, the house prices, which had constant and severe losses since the second semester of the past year, jumped sharply in May, against most of the expert forecasts, adding an extra stimulus for the improved attractiveness of the pound.

According to analysts, the pound has been favored this week by a combination of two distinct factors: the positive house survey and the gradual recovery in markets boosted by evidences that the global slump is easing considerably. Specialists also indicate that multiple domestic and international news brought the pound down to levels which do not reflect the real value of the currency, and as the scenario is not so gloomy for the moment, the pound is coming back to a more reasonable pricing level.

GBP/USD traded at 1.6120 from 1.5915 and GBP/JPY also rose from 154.20 to 154.73.

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Russian Ruble Climbs on Oil Uptrend, Stocks Rally

The Russian ruble posted gains against the U.S. dollar for the third day in a row, as the demand for oil increases, causing the Russian stock market to have the highest rally since the beginning of the global slump.

Since the oil has rebounded reaching $67.50 a barrel this week, a sharp rally has followed in the Russian equities market, consequently pushing the ruble up, which had suffered severe losses as the global slump started last year. Russia’s economy is highly orientated to exporting its multiple natural resources mainly to Europe and Asia, and when the global slump struck the commodities market, Russia saw the Moscow Stock Exchange to drop even 20 percent in one session during the worst days of the crisis. Today UBS AG said that Russia’s economy scenario is improving, adding to the growing optimism in the domestic market and among exporters, helping the ruble to continue its rally.

As analysts predict that the Russian economy will revive its expansion path in the third quarter of this year or earlier, optimism is slowly gaining space among investors, and with the UBS AG report being positive towards Russia, it is very like that the MSE will post sequential gains during the next weeks.

USD/RUB fell to 30.61 from last week’s closing price of 30.83.

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