Things Looking Up For Sterling
Sterling had a particularly strong end to the week after minutes from the latest MPC meeting showed that a couple of members were starting to move back to voting in favour of a rate hike. This week we will see GDP figures out of the UK. It will be interesting to see whether these continue to show signs of improvement and how the markets take this news. We are still in a bit of a state of limbo as the General Election is now only a week and a half away and it is proving practically impossible to predict the outcome of this, let alone the implications any possible result will have on Sterling.
Sterling gained against the Dollar as durable goods orders released last week, although surpassing expectations, were actually quite disappointing. This has come on the back of a raft of disappointing US data and it is another signal of the weakness of the US economy. We should get more of an idea of the current state of affairs in the US as we get GDP figures for Q1 this week as well as the latest Fed policy meeting and Nonfarm Payrolls data.
In Europe, the status quo remains between Europe and Greece after a weekend of meetings between Angela Merkel and Greek PM Tsipras. What is in no doubt is that Greece is running out of money and seems to be constantly on the brink of default. However, what isn’t certain is that no one knows when this will happen or what the consequences will be. It may well be a case of who blinks first.
It’s a relatively quiet start to the week on the data front today with the main headline releases being the PMI data from the US this afternoon.