The pound has steadied its fall against the euro, strengthening slightly after “hawkish” comments from the European Central Bank. Against the dollar, sterling remains weaker.
The ECB surprised markets yesterday, saying that it may end its quantitative easing programme in Q3 of 2022, a month earlier than previously thought. The euro initially saw support from these comments, but these gains were short-lived.
In the UK, the economy rebounded strongly in January as disruption from the Omicron variant diminishes, however, surging prices may mean this recovery is temporary. Markets will now be looking to the Bank of England’s next interest rate decision on Thursday.
The dollar remains stronger against the pound and euro following red-hot inflation figures. Markets will be interested in how the Federal Reserve reacts to this.
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