Sterling remains close to its strongest point since August 2022 against the euro, and close to 5% up on the average of the past five years. It’s also riding high against the US dollar, but it is the euro’s weakness that’s the big story and that may be priced into the value of GBP/EUR now.
So, will sterling still be strong after the busy week ahead? On Wednesday there will be new inflation data for the UK, with a fall to 2% expected from the current 2.3%. That would bring it back to the Bank of England’s (BoE) target and give Rishi Sunak some good news on a General Election campaign trail that has been short of that so far.
Then on Thursday the Bank of England will make a decision on interest rates. Could we see the first cut since March 2020? Again, if it happens, good news for the Conservatives and a twist in the election?
Lower than expected inflation, a rate cut or a change in the opinion polls could all knock sterling off its perch, so to lock in this two-year high, call your account manager on 020 8108 5163.
Also coming up this week are two more of the highest-level data readings of the month: Retail Sales and the Purchasing Manager’s Index (PMI). Analysts are forecasting both to have bounced back after disappointing results last month.
There are two full working days until the first of those big data readings, so why not call your account manager and discuss your options for locking in recent strength in sterling?
