Last week saw the US Dollar continuing its recent run of strength, with the Greenback hitting its most expensive level for a month. The momentum caused by the Federal Reserve’s likely slowing of its monetary easing programme, has returned the USD to safe haven status, and seen investors buying the currency with a resultant increase in value and drop in rates for those of you looking to send money to the USA. The minutes of the latest Federal Reserve meeting are released on Wednesday evening and could see this pattern gain further impetus.
Closer to home we had a quieter week in the UK and Europe, with the Euro trading in a range of less than a cent against the Pound all week. In Europe this week the only data of note is consumer confidence on Thursday.
In the UK and for the Pound however we have a busy week ahead with key data releases throughout the week. Tomorrow sees the monthly consumer inflation figures releases, which can have a significant impact on the Pound, and on Wednesday the Bank of England minutes will reveal how much the prospect of further QE was discussed by the MPC earlier this month. On Thursday we then have the first revision to Q1 GDP, and we would urge caution on this particularly as the initial reading was better than expected, and most recent revisions have been negative. Needless to say any significant downward revision could raise the prospect of a third period of recession in the UK which would very likely damage the Pound.
Further afield this week there are figures due out in Japan, New Zealand and Canada.