While the UK enjoyed a long Bank Holiday, the currency markets were open elsewhere in the world. Following its strong showing in the days leading up to Easter, sterling has traded negatively against the US dollar and sideways against the euro in the past 36 hours.
Against USD, the pound fell to below $1.30 early this morning, its lowest point since November 2020, before recovering marginally.
The picture is very different against the euro, where last week’s gain against the euro was mainly a result of higher-than-expected inflation figures for the UK, alongside the European Central Bank’s (ECB) decision not to raise interest rates.
It’s a quiet early part of the week for data but followed by a potentially influential Friday, with PMI and other economic data.
Also of interest will be various speeches by interest-rate setters in the UK, eurozone and US.
They will be keeping close tabs on economic reports such as the one from the IMF on Thursday, which has slashed its projections for global economic growth amid the war in Ukraine and inflation. “This is a massive setback for the global recovery” said Kristalina Georgieva, chief of the IMF.
In business news, the UK government is considering a compulsory rental auction scheme for empty shop units, in an effort o reinvigorate the high street. It is also cutting off-peak rail fares over the next two months by as much as half in an effort to tempt the public back onto the railways. Sticking with transport, in the US a silent, battery-powered plane took off vertically for the first ever time. It has a range of nearly 300 miles.
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