By Tom Arnold
Over the course of the last couple of weeks Sterling has managed to hold fairly steady against the Euro, as markets wait with baited breathe for the Chancellor Rachel Reeves to deliver her Autumn Budget this coming Wednesday. Much has been reported and leaked (!) about what we might expect, but speculation aside the Chancellor has limited options at her disposal, significant money needs to be generated, and so tax rises are pretty much guaranteed.
Expectations are that we will see some volatility for the Pound as a result of the likely market turmoil that will come from a big change in the government’s tax approach, but it remains to be seen whether Sterling will unravel post-budget, or whether markets will turn their attention to the next big event on the horizon, which is an almost certain interest rate cut from the Bank of England in mid-December.
Whichever way the Budget goes, you can expect the Pound to remain under significant pressure overt the course of this week and in fact over the next few weeks up until that Bank of England announcement.
The week ahead has a few important economic releases, but the UK Budget is easily the most critical. As ever, stay in close contact with your currency consultant to be kept informed of exactly what is happening and what the options are to help you mitigate the risk of Sterling volatility.
Monday
ECB President Lagarde Speech
Tuesday
US PPI
US Retail Sales
Wednesday
New Zealand Interest Rate Decision
UK Budget
US Initial Jobless Claims
Thursday
German GfK Consumer Confidence
EU Consumer Confidence
Friday
German Retail Sales
German CPI Inflation
Canadian GDP