A busy week for data

Good morning,

The pound has gained momentum through the day of the Asian trading session, nearing the 1.1350 high of last week against the euro. Looking back, you would have to go to May of 2020 to find a similar price, as the Covid pandemic was crippling the UK economy. Against the dollar it is a similar story, with the pair holding around the 1.3730 mark, at the time of writing.

It is due to be a busy week for GBPEUR, with various European data releases due throughout the course of the week. Tomorrow will see the release of the Eurozone GDP figure, Wednesday, European CPI data and Thursday, European retail sales data. Should any of these data release deviate lower than the expected results, it could give GBPEUR room to push higher.

The big event for the week will see the Bank of England’s Monetary Policy Committee meet for the first time this year. It is widely expected that interest rates will remain at the current 0.1% mark. However, should the committee not see enough from the UK economy and believe interest rates need to be cut, sterling could see selling pressure late into the week. Throughout 2020 there were rumours that rates could turn negative, with the bank even investigating the possibility of deploying the tactic through the second half of last year.

And as with the first Friday of every month, the US releases not farm payroll data. A key metric in the FX world, the dollar could give up further ground, should the employment figure be weaker than expected.

Have a great day.

Jack Nicholls, Relationship Manager.

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