- Pound (GBP) rises after falling last week
- UK jobs data due tomorrow
- Euro (EUR) falls after strong gains last week on hawkish ECB officials
- ECB President Lagarde to speak
The Pound Euro (GBP/EUR) exchange rate is rising after losses in the previous week. The pair fell -0.83% in the previous session, settling on Wednesday at €1.1292, after trading in a range between €1.1286 – €1.1412. At 05:45 UTC, GBP/EUR trades +0.05% at €1.1298.
The pound is edging higher on Monday after losses last week, a week which was relatively quiet as far a economic data wads concerned. On Friday, Bank of England policymaker Silvana Tenreyo spoke, saying that patience was needed to bring down inflation. She said that the past interest rate hikes would take time to bring inflation down and that it was important not to over-adjust policy while the impact of those hikes was still not feeding through.
While there is no high impacting UK economic data due to be released today, there is plenty across the week, starting tomorrow, with the release of UK labour market data. UK inflation data on Wednesday will be the most closely watched release and comes as the probability of a rate hike from the BoE still appears to be hanging in the balance. Hotter-than-expected inflation could fuel rate hike bets and boost the pound.
The euro rose strongly last week after ECB speakers were out in force talking up the probability of a rate hike from the central bank in May.
The market is now fully expecting a 25 basis point rate hike next month and is 48% certain that the ECB could hike by another 50 basis points.
There is no high-impacting eurozone data due today; investors will focus on a speech by ECB President Christine Lagarde for further clues over the central bank’s next moves.
The German ZEW economic sentiment release will also be in focus tomorrow and comes after German wholesale prices fell by 2% year on year in March, down from 8.9% in February.
