2023.03.2710:21:00UTC+00Pound Appreciates On Easing Banking Concerns

The pound climbed against its most major counterparts in the European session on Monday, as European shares rose following the acquisition of Silicon Valley Bank by First Citizens Bank.

First Citizens Bank announced that it has agreed to buy all the loans and deposits of Silicon Valley Bank and gave the Federal Deposit Insurance Corp equity rights in its stock worth up to $500 million.

Comments from the U.S. Federal Reserve officials reduced concerns about the turmoil in the banking sector.

St. Louis Federal Reserve President James Bullard said on Friday that the stress in the banking sector will abate, and the Fed needs to push interest rates higher than previously expected.

Elsewhere, the U.S. Financial Stability Oversight Council said the U.S. banking system was "sound and resilient" despite stress on some institutions.

The pound advanced to 1.2265 against the greenback and 0.8777 against the euro, off its early lows of 1.2218 and 0.8806, respectively. The currency is seen finding resistance around 1.26 against the greenback and 0.86 against the euro.

The pound was up against the yen, at a 4-day high of 161.09. If the pound continues its rise, 164.00 is possibly seen as its next resistance level.

In contrast, the pound eased off to 1.1220 against the franc. The pound is likely to challenge support around the 1.11 region, if it drops again.