Yesterday was a very quiet day on the markets, with virtually no movement of note across any of the major currencies, other than some very small range bound variance. This was due to an absence of any serious data and also the public holiday across many countries particularly in Europe.
However today could see a bit more volatility. There is not much in the way of serious data due for release today, but there are some quite critical factors coming to a head, albeit not particularly under the spotlight.
In the UK we have industrial production and manufacturing production numbers out this morning at 9.30am. These are fairly important data releases and would usually be something to watch for and this month is no different. In addition there is also a feeling that the UK economy’s recovery while impressive and very much on track is being made a bit more of than is in fact the reality. Various economic numbers over the last few weeks have been OK, without pulling up any trees and as a result many analysts are awaiting a correction if we do get any surprisingly negative data. This is also supported by the Pound’s inability to push on in the face of a weak Euro and Dollar – we have been relatively static for a while now even during last week’s ECB action which should really have seen the Euro lose significant ground.
On the ECB subject; last week’s announcement was a big one for the Eurozone and the shockwaves are undoubtedly still being assessed across Europe’s big banks. Today sees various members of the ECB’s governing council being interviewed, and while this is nothing particularly unusual, you can expect them to be questioned pretty directly about the ECB’s action last week and more importantly whether there is likely to be more action in the months to come…
So today could be a key day for the markets – is the Pound on a knife edge of over-optimism? Have the ECB really only just got started?
As ever, to be kept informed of exactly what is happening and how that is likely to affect your upcoming currency purchase, please do stay in close contact with your CI account manager.