- Pound (GBP) holds steady in quiet trade
- CBI sales rise
- Euro (EUR) rose after German consumer morale improved
- Eurozone consumer confidence is due
The Pound Euro (GBP/EUR) exchange rate is holding steady after losses in the previous session. The pair fell -0.18% yesterday, settling on Wednesday at €1.1288, after trading in a range between €1.1266 – €1.1319. At 05:45 UTC, GBP/EUR trades +0.01% at €1.1290.
The pound fell on Wednesday but traded within a narrow range amid a lack of high-impacting fresh fundamental drivers. Remains broadly supported by the likelihood of another Bank of England interest rate rise in the May meeting. Expectations are for the central bank to hike rates by another 25 basis points with the possibility of more rate hikes in the future should inflation prove to be stickier than expected.
Sales data from the Confederation of British Industry also help limit the losses in sterling. The data showed that sales in April rose to +5, the highest level in five months, up from +1 in March. However, the outlook was less upbeat, with a number of respondents to the survey expecting sales volumes to fall next month.
Today, again the UK economic calendar is quiet, so the pound is likely to be influenced by market sentiment and could lack a firm direction.
The row pushed higher yesterday after German consumer morale improved by more than expected in May amid learning energy prices and expected wage increases. The closely watched GFK consumer confidence survey showed that the index rose to -25.7, up from -29.3 in April. This marked the seventh straight month of improving sentiment Came in above forecasts of -27.9.
Attending to eurozone consumer confidence data which is also expected to improve.
Meanwhile, the euro continues to be supported by European Central Bank officials who have been sounding particularly hawkish in recent weeks. Today, ECB official Panetta will speak, and any comments surrounding inflation oh monetary policy could influence the euro.
