By Matthew Boyle
Last week, the pound was generally firmer against both the euro and the dollar. Sterling gained support from improving market sentiment and expectations that the Bank of England could maintain a relatively firm policy stance, while the euro was influenced by European Central Bank developments and the dollar lost some momentum later in the week.
Against the euro, the pound traded in a relatively tight range and finished the week slightly stronger overall, with investors weighing Bank of England and ECB policy expectations.
Against the dollar, sterling recovered after early-week pressure from a stronger US currency. As geopolitical tensions eased and risk appetite improved, the pound strengthened and ended the week on a firmer footing versus the dollar.
For the dollar versus the euro, the dollar started the period relatively strongly but weakened as the week progressed. The euro benefited from expectations around ECB policy and improving investor confidence, leading to modest euro gains against the US currency.
In summary: pound stronger versus euro, pound stronger versus dollar, and euro stronger versus dollar over the course of last week.
This week all eyes will be focused on the pound as we see UK inflation data released on Wednesday, and the all-important interest rate decision by the Bank of England on Thursday. Whilst no change is expected it will undoubtedly set the path for the pound in the coming months and determine whether we will continue to see GBP at close to 12-month highs, or see the Pound slip against the single currency.
Should you have an upcoming transfer to make speak to your currency consultant today for some friendly guidance on how to make your money go further.
Monday
08.30 EUR ECB president Lagarde speech
10.00 EUR Industrial production data
Tuesday
05.30 AUD RBA Interest rate decision and Monetary policy statement
13.30 USD Housing data
Wednesday
07.00 GBP Inflation data and Producer price index
13.30 USD Retail Sales
19.00 USD Fed interest rate decision and Monetary policy statement
Thursday
07.00 GBP Claimant count change
12.00 GBP Interest rate decision and MPC vote
Friday
07.00 GBP Retail Sales