The pound strengthened against both the euro and the dollar last week following news that the US is entering a ‘technical recession’ and growing tension between Russia and the eurozone. This morning sterling remains up.
It’s a busy week in the UK data calendar with manufacturing PMI figures due this morning, house price data tomorrow and the Bank of England’s next interest rate decision on Thursday. Markets have been expecting another 25-basis point hike, however, rumours of a larger, 50-basis point hike have been flying around.
In the political world, Rishi Sunak has announced that if he wins the UK leadership race, he will cut the basic rate of income tax from 20% to 16%, in what he has called the “largest cut to income tax in 30 years”.
