The pound enters the four day week with gains of over half a percent against the euro compared to this time last Tuesday. Against the US dollar, sterling remains somewhat unchanged across the same timespan. This comes ahead of an interesting week of key economic data.
We’ve just heard the latest monthly and yearly Nationwide housing prices, which rose by 0.5 and dropped by 2.7%, respectively.
For the remainder of this week, things are fairly quiet on the UK data front. However, investors will have lots on their plates with eurozone and US data.
The European Central Bank (ECB) and US Federal Reserve (Fed) will decide on interest rates this week – both banks are expected to hike rates by 25 basis points to combat unruly inflation. Read more on what central banks are projecting for inflation in our April-June Quarterly Forecast.
So far, and in the lead up to the ECB’s decision, the euro has remained close to its one-year high against the US dollar, so of course, all eyes will be on the single currency to see how it responds to Thursday’s data.
Across the pond, things are pretty similar this week, but in addition to the Fed’s interest rate decision, dollar watchers will have a variety of economic data releases to digest over the course of this week — each carrying the potential to impact dollar movements. Some of the big ones include JOLTs this afternoon, the Federal Reserve’s interest rate decision on Wednesday and Nonfarm payrolls on Friday.
The US banking sector witnessed its second-largest failure in US history, with the collapse of First Republic yesterday. The San Fransisco —based bank was taken over by JP Morgan Chase after marking the third collapse in the US banking sector since last month.
Yesterday was a not-so positive day for US stocks, with all three major US indexes finishing close to the flatline. The Dow ended 0.1% lower, while the Nasdaq and S&P 500 both finished below the flatline. This came after investors digested lots of economic data. It also follows JP Morgan Chase’s takeover of First Republic Bank’s assets.
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