By Simon Eastman
Yesterday we saw the pound make gains across the board as markets took positivity out of comments Trump made surrounding a potential ceasefire with Iran.
With the chances of a ceasefire, leading the way for the Staite of Hormuz to open, allowing crude oil to flow out of the Gulf once again, this lessens the chances of inflation soaring. Whilst the Bank of England needing to raise interest rates to combat inflation and bring it back down would generally be seen as a positive for the pound, the stability lower inflation will mean for the economy outweighs the benefit of outside investment in sterling might bring.
Adding to this sentiment, we also saw the pound benefit from comments made by Andrew Bailey, the Bank of England chief, who suggested markets were getting ahead of themselves speculating over interest rate rises earlier in the trading day.
As a result, we saw the pound move up over half a cent against the single currency euro and nearly a cent and a half against the US dollar.
As April kicked off, a new month and new quarter, we had a handful of data releases to digest, little of which seemed to impact market sentiment much. EU unemployment came out slightly under expectations, whilst US retail sales beat forecast by 0.1 percent, whilst later in the day manufacturing PMI also beat expectations coming out at 52.7 moving even further into positive territory (anything over 50 is seen as positive).
Thursday just brings some low-key US jobs data ahead of the UK and EU long Easter break which sees our markets closed, so for anyone with a currency transfer to make in the coming week it might be prudent to get it sorted before the long weekend.
Furthermore, if anyone is looking to buy USD, be aware that Friday is not a US holiday and we see a raft of key data releases including unemployment and non-farm payrolls, so it might be prudent to secure your dollars today or risk the market potentially moving against you over the bank holiday.
Speak to one of the friendly team today to let us help you make your money go further.