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Interest Decisions Week

Interest Decisions Week

As we enter February, as always the first week of the months sees the markets focussed on the interest rate decisions on Thursday from both the Bank of England and the European Central Bank. Analysts from Citi and Nomura believe Mark Carney will be the the first to actually increase interest rates but this will not be until the beginning of 2015 which is still ahead of schedule.

We are expecting tomorrows Eurozone Producer Prices for December to have fallen again and combined with a constant less than 1% rise in the Euro-area consumer prices, it is suspected that there could possibly be further interest rate cuts by Mario Draghi this Thursday.

Having risen by 11% in the past year, GBP is still the best performer amongst the top 10 developed nation currencies, compared to 4.5% for the Euro and 5.8% for the USD. In these markets, it may be an idea to consider a forward contract with rates as they are.

 

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