Sterling remained strong yesterday, surprising the market with better than expected job data. Markets were expecting around 145k new jobs; however, the reading smashed through that target and showed 180k new jobs were added in the final quarter of 2019. The knock-on effect of this should point fingers to a wage rise across the country and give the Bank of England less reason to cut interest rates and keep the Pound relatively strong.
The above, coupled with poor economic sentiment data release from Germany, was enough to keep GBPEUR above 1.20. The market’s most traded currency pair, EURUSD, fell below the 1.08 mark before recovering to marginally hold above. Pessimism within the Eurozone could see the level tested again today.
We still have a whole host of data releases from the UK this week, with inflation data in the crosshairs this morning. Analysts across the board are predicting no major surprises, with a slight rebound in the results expected which should also keep the Bank of England away from cutting rates in the short term.
Later this evening at 19:00 GMT, we have the Federal Open Market Committee meeting minutes for January released. This isn’t expected to move markets too much, though topics such as the US/China Phase One trade agreement and the impact of the Coronavirus outbreak are expected to be touched upon.
Have a great day.
Author: Jack Nicholls, Relationship Manager
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