The spectre of the ECB meeting on thursday will also have people moving out of positions as analysts argue over whether the Europeans are asleep at the wheel. The head of the IMF, Dominique Strauss-Kahn, stated that he was worried that the EU was ‘underestimating the need for stimulus’ and that by keeping interest rates high they will stay in the doldrums for longer. This has been our view since October and hence our predictions of a stronger GBP/EUR over the course of the year.

In any case we believe we will see a 50bps cut on thursday and further cuts in March from Frankfurt.

Although this week is chock full of data yesterday was fairly barren however today we have trade balances from both the US and UK.

Please feel free to contact me (jeremy.cook@worldfirst.com) if you have any questions or thoughts regarding these updates or if you are interested in a particular event in the calendar. If you would like to discuss your foreign exchange requirements, please contact our:

Corporate Foreign Exchange Team on 020 7801 9050 or our Private Client Currency Exchange Team on 020 7801 9080.

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Disclaimer: The above comments are only our views and should not be construed as advice. You should act using your own information and judgement. Although information has been obtained from and is based upon multiple sources the author believes to be reliable, we do not guarantee its accuracy and it may be incomplete or condensed. All opinions and estimates constitute the author’s own judgement as of the date of the briefing and are subject to change without notice.

Any rates given are “interbank” i.e. for amounts of £5million and thus are not indicative of rates offered by World First for smaller amounts. E&OE. Definitions of jargon/market terms can be found in our Glossary of Foreign Exchange Terms.