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The market remains ready to pounce on news of interest hike but unfortunately that news is not scheduled until next week, leading to fairly dull trade over the past couple of days. Nobody is prepared to limp in to the market. The predominant thoughts are that we will see a rate rise from the Europeans (although the logic to this escapes us) and that the Bank of England will hold at 0.5% as it has for the past 2 years. This and only this is the reason that EUR is so strong versus its crosses. Should we see the ECB vacillate in its decision making process then we would expect to see some big euro weakness.

The focus today is on Ireland and its banking sector. The details of the recent stress tests are due at 16.30 and are expected to show a need for an extra EUR23bn to shore up their finances. One side effect could be that, to all intents and purposes, that the entire Irish banking sector will be nationalised. The only bank to not take cash from the Irish state looks likely to cede control to the government and barring a miracle that would make the Irish bank sector a government entity.

We have seen some good news from the UK today in the form of Nationwide House prices showing that prices rose in March by a figure of around 0.5%. This goes against the news from Hometrack, another property analyst, that prices fell by -0.1%. Prices in London continue to rise however as foreign buyers push onwards with purchases while domestic buyers who are taking on new properties elsewhere and are funded by UK based credit are still finding it tough.

UK consumer confidence was also published overnight and remains low. Simply put, what has the average UK consumer got to be confident about? Unemployment remains high, costs are rising, growth is slow and the housing market is still very perilous. After all this data sterling is slightly higher although within yesterday’s range.

Latest exchange rates at time of writing