By Grace Smyth
As we enter August, a new month brings fresh economic data releases. We have had a fairly busy start to the week already with the eurozone posting better then expected Q2 GDP on Monday: 0.6% compared to the expected 0.4% year on year. Eurozone unemployment on Tuesday was also positive with no change and remaining at 6.4%. All good indicators that the eurozone is on the right path to recovery.
Yesterday afternoon, the focus shifted to the US.
The week ahead remains pretty busy on the data front, with the key events listed below. The main focus of the week will take place tomorrow, as eyes cast over to the Bank of England who are set to announce their latest interest rate decision and release their monetary policy statement at 12pm. Inflation is currently the driver for raising interest rates and while inflation is reportedly dropping and food inflation is beginning to slow, levels are still sitting at record highs and it is likely that the Bank of England will decide to raise interest rates from the current rate of 5% by 0.25 basis point to 5.25%. The Pound will likely be very reactive to the decision and accompanying statement.
The past couple of weeks have seen exchange rates trading within a one cent range against the Euro and currently sitting closer to the top end of that range this week. We saw a dip in the last few weeks with a slow recovery back to current levels, so it is likely that a rate increase is already priced in to current exchange rates, but there is every chance we could see a knee jerk reaction in the market as the BoE release their decision, so do stay in close contact with your A Place in the Sun Currency account manager here should you have a currency requirement to secure.
Thursday lunch time, is taken over by the US who are due to release jobless claims and PMI data which continues on Friday with non farm payroll and unemployment rates.
As ever, if you have an upcoming currency requirement, whether it be in the next few days, weeks or even months, then do get in touch with a member of our friendly team. Its always a good idea to get a grasp on exchange rates well in advance of needing to make an exchange as the fluctuations in exchange rates can be pretty costly, and when you are looking to buy your dream home in the sun, wouldn’t you want to be made aware of the implications this might have to your budget? It could be the difference of a few hundred if not thousands of pounds so let us do the hard work for you and keep you updated when opportune moments come up to help you save money.
Data this week
Wednesday
US Employment Change
Thursday
AU Retail Sales
EU Composite + Services PMI
UK Composite + Services PMI
EU PPI
BoE Interest Rate Decision + Policy Statement
US Initial Jobless Claims
US Composite + Services PMI
Friday
EU Retail Sales
US Non-Farm Payrolls
US Unemployment Rate