Sterling is trading near a 2-year high against the euro and has reached a 9-week high against dollar this morning, after a resilient first week of 2022.
There will be a series of UK data releases on Friday this week, including UK GDP figures for November, which are expected to improve slightly month-on-month. However, any surprises could impact sterling.
In the meantime, the pound is likely to react to any COVID-19 related news and respond to general market sentiment.
December’s inflation data will be released for the US on Wednesday and the markets will be watching closely to see if this could impact the Federal Reserve’s approach to interest rates. Several Fed officials will speak following the event.
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