After a strong start to the week for the pound, things took a turn in the opposite direction on Tuesday. Worse than expected PMI data, in addition to ongoing inflationary pressures, saw sterling relinquish weekly gains against both the euro and the dollar. This morning however, the pound is stronger against the greenback, with fresh weekly gains.
Royal Mail have said the recent wave of strikes this winter has cost the postal firm £200m so far. The dispute with the Communication Workers Union (CWU), which began in August led to 18 days of walkouts;7 of those being over the festive period in December.
The Indian rupee climbed against the US dollar on Wednesday, which was helped by likely dollar inflows and gains in most major Asian peers. Read more about the Indian rupee, plus the pound, euro and dollar in our brand-new Quarterly Forecast which is free to download.
Across the pond, the Bank of Canada signalled an end to its aggressive tightening cycle in its first meeting of 2023, as it raised the target for its overnight rate by 25bps to 4.5%.
In the eurozone, data from the Ifo institute revealed that the latest business climate indicator for Germany rose by 1.6 points in January. This marked the fourth consecutive month of increase and the highest level since June last year.
In the US stock markets, the picture looked less optimistic with the Dow losing almost 300 points on Wednesday. Meanwhile, the S&P 500 and Nasdaq 100 also lost 1.2% and 1.9%, respectively. This was largely due to disappointing earnings which added to pre-existing recession concerns.
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