All this and more is available on our video blog at http://uk.youtube.com/user/WorldFirstJC

Thoughts of a deflationary spiral for the UK receded yesterday after inflation measures showed an unexpected rise. Imports have obviously become more expensive with the fall in the pound over the past 8 months and retailers have passed this increased cost onto the consumer. The largest areas of pass-through were in food, toys and household appliances.

 

This data will not likely affect monetary policy in the short term in the UK; what more can the MPC do with rates already sat at a 315 year low? On a fiscal side the Office of National Statistics announced that more and more companies are starting to reverse the VAT tax cut we saw towards the end part of last year.

 

Sterling leapt higher against the US dollar and Euro on the announcement pushing towards 1.48 against the greenback and returned to the high 1.08s against the single currency with market commentators believing that the Bank of England may not be so blasé about sending £ lower.

 

Asian equity markets were slightly lower overnight as news from Japan showed how weak the land of the rising sun is at the moment. Japanese exports were 49% lower in February prompting yen to weaken markedly against most of its trading partners.

 

We have a ‘tapas’ like day of data; tasty bits and bobs. German IFO business climate (due 09.00) is expected to fall to 82.2 from 82.6 while UK CBI Distributive Trends (11.00) are set to decline to -35 to -25.

 

All this and more is available on our video blog at http://uk.youtube.com/user/WorldFirstJC

Indicative Rates

 

Sell

Buy

GBPEUR

1.0860

1.0885

GBPUSD

1.4595

1.4620

EURUSD

1.3423

1.3448

GBPJPY

142.60

143.13

GBPAUD

2.1053

2.1120

GBPNZD

2.6236

2.6297

GBPCAD

1.7990

1.8058

NZDUSD

0.5552

0.5578

GBPZAR

14.01

14.07

USDZAR

9.58

9.63

GBPPLN

4.9631

4.9982

EURJPY

131.23

131.70

Rates are dependent on amount transacted
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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. 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.