Currency Buzz: Pound Off Two Week Low Against US Dollar After UK House Price Inflation Spikes

2 Mar 2022 , 02:42 PM

The British Pound (GBP) cut losses today after a firm reading on the housing front. UK house prices grew at the fastest pace in eight months in February driven by robust demand and limited stock of homes, the Nationwide Building Society reported Wednesday. House price inflation unexpectedly increased to 12.6 percent from 11.2% in January. This was the strongest since June last year.

On a monthly basis, house prices gained 1.7%, faster than the 0.8% rise posted in January. The price of a typical home rose above GBP 260,000. Prices are up GBP 29,162 over the past twelve months. The price of a typical home was 20% higher than in February 2020 – the month before the pandemic struck the UK.

This capped the downmove in the GBP/USD pair after it tested a one week low of 1.3270. US dollar remains in a good form amid continued safe haven demand as the Russia-Ukraine war rages on. The GBP/USD currency pair now quotes at 1.3290, down marginally on the day.

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