Charts flipped throughout last week, with the euro making a fightback following an aggressive sell off the week before. The euro was seen to be one of the biggest losers from the conflict in Ukraine, with sanctions having potentially the widest impact, outside of Russia, within the Eurozone.
This week sees both The Fed and the Bank of England announce their interest rate decision. The Fed is up first on Wednesday evening UK time, and rumours of a 0.25% interest rate hike are being spoken about. However, with the speculation being just that, it waits to be seen how The Fed interprets previous month’s data and their outlook moving forward. On Thursday it is then the turn of the Monetary Policy Committee, markets are also predicting a raise in rates for the UK, to 0.75%.
The situation in Ukraine continues to develop and have an impact on the wider global economy. In correlation with the anticipated interest rate hikes and the flock to haven currencies in times of uncertainty, the dollar has gained and now pushed GBP/USD towards the 1.30 mark. Despite making a slight U-turn this morning, the pair are trading at 1.3054 at the time of writing.
Have a great day.
Author: Jack Nicholls, Senior Relationship Manager.
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