Pound Strengthens Against Majors

The British currency edged higher against its major rivals in early deals on Monday despite a fall in European equities.

Bank of England's Monetary Policy Committee member David Miles said that real house prices are likely to follow an upward trajectory, which may become steeper if population density rises.

The U.K. house prices continue to rise in March, as first time buyers rushed to avail the stamp duty exemption, a survey carried out by Rightmove showed.

Asking prices of property for sale grew 1.6 percent month-over-month in the month following the 4.1 percent increase in February. In the first quarter, house prices were up 4.9 percent, marking the largest increase since 2004.

Separately, data from a survey by Markit Economics showed that the household finance index in the United Kingdom, which is designed to anticipate changing consumer behavior, decreased at a faster pace in March.

The headline index dropped to 37.8 in the month from 38.7 in February, with an index reading below 50 indicating deterioration in sentiment.

European markets are in negative territory after remarks by IMF Managing Director Christine Lagarde warned against "a false sense of security" after the global economy just managed to step back from the brink.

Meanwhile, deepening worries about a slowdown in the world's second-largest economy, Chinese house prices decreased in February largely due to governmental measures to cool the property market, the National Bureau of Statistics said.

On a yearly basis, house prices in China decreased in 27 out of the 70 cities in February, while prices were down in 45 of the 70 cities on a month-on-month basis.

Thus far, the U.K. FTSE 100 index slipped 0.36 percent, France's CAC-40 index fell to 0.67 percent and Germany's DAX dropped 0.61 percent.

Extending its recent rally, the pound touched 0.8287 against the euro around 7:45 am ET, its highest level since February 16. On the upside, the next likely resistance level for the sterling is seen around the 0.8275/80 area.

The Eurozone current account surplus increased to EUR 4.5 billion in January from EUR 3.4 billion in December, the European Central Bank said today.

The surplus in income account doubled in January and the current transfer deficit narrowed from a month ago. The surplus for income came in at EUR 3 billion, larger than December's EUR 1.3 billion surplus. The deficit in current transfers narrowed to EUR 7.3 billion from EUR 9 billion.

Against the Swiss franc, the pound advanced to a 4-day high of 1.4567 around the same time. The pound franc pair is presently worth 1.4560 with 1.46 seen as the next likely resistance level.

The pound also continued to creep higher against the dollar, hitting as high as 1.5886 for the first time since March 2. The cable thus broke past the 200-day SMA and its next barrier could be seen around the 1.5970 level.

The pound that fell against the yen in the Asian trading reversed direction ahead of the North American session on Monday. As of 8:00 am ET, the pound was quoted at 132.14 against the yen, up from 131.49 hit earlier in the session.