020 7898 0500There was no real data released in the UK on Friday but we saw the GBP/EUR pairing slide to its lowest level since November last year, while the GBP/USD pairing also tracked slightly lower. This was largely due to the ‘risk off’ trade ahead of the weekend in light of the escalating tensions between North Korea and the US.
Looking ahead, we have a much busier week in terms of economic data. On Tuesday, the UK’s inflation numbers are due to hit the wires with the headline figure expected to tick slightly higher to 2.7%. While this would support a move towards an interest rate hike, that view would need more support from the next round of data, with the unemployment rate and salary inflation due to post their readings.
If the differential between salary inflation and headline inflation continues to widen it will reduce the probability of a hike, as the effect on the consumer could be detrimental. On Thursday, the final piece of headline data due to hit will be the retail sales figure.
