- Pound (GBP) edges mildly high in cautious trades
- BoE governor Andrew Bailey is due to speak
- Euro (EUR) edges lower in risk off-trade
- There is no high impacting euro zone data die today
The Pound Euro (GBP/EUR) exchange rate is heading modestly higher on Monday, adding to gains from last week. The pair rose +0.63% across the previous week, settling on Friday at €1.1998 and after trading a 140-pip range between €1.1880 – €1.2056. At 05:45 UTC, GBP/EUR trades +0.05% at €1.2005.
The Pound rose in the previous week as inflation surged to a 30 year high and consumer confidence fell to a 20 month low. The Pound even pushed higher versus the euro on Friday when data revealed that retail sales unexpectedly fell in February.
Retail sales fell 0.3% in February month on month as the British economy reopened after Omicron prompting consumers to eat and drink in bars and restaurants rather than shop for food and stay at home. Online sales fell to pre-pandemic levels while lousy weather also kept consumers from hitting the shops. Analysts had expected retail sales to rise 0.6%, and the figure was down from the 1.9% growth recorded in January.
There is no high-impacting data due to be released today. Instead, investors will look to Bank of England Governor Andrew Bailey, who is scheduled to give a speech and could offer further insight into the speed of monetary policy tightening in the UK.
The Euro fell across last week amid continued uncertainty over the Russia Ukraine war and the fallout from the war.
Data on Friday revealed that business sentiment saw a record fall in March amid the ongoing war. The closely watched IFO business climate index plunged to 90.8, down from a five-month high of 98.5 in February and well below forecasts of 94.2.
Today the euro is edging a few pips lower in risk off trade as COVUD cases is China rise and amid ongoing concerns over rhe Russia war. There is no hihg impacting eurozone data due today. Instead, investors will continue to focus on Russia, Ukraine’s developments. In-person peace talks are set to resume in Turkey this week. So far, there has been little tangible progress in negotiations.
