The pound is up against the euro this morning as lockdown restrictions begin to ease for businesses and schools. Key year groups are back from today, and open-air markets and car showrooms are also opening. In two weeks’ time, non-essential shops in England will be able to reopen, too.
However, we can expect focus to turn further to Brexit this month, as the deadline for the UK government to request an extension approaches. So far, it looks likely that they will not ask for one.
Later this morning, we will see manufacturing PMI, forecast to show a small uptick. Tomorrow we will see mortgage lending and approvals for April, which are widely expected to show a steep drop. The main figure for this week is May consumer confidence; forecasts expect a further decline, but any unforeseen movement towards the positive could strengthen the pound. Also on Friday, we will see Halifax house price data.
Thursday’s exchange rate decision is expected to see rates held on hold, as the Bank has precious little room to manoeuvre.
