020 7898 0500At one point it looked as if sterling might ‘take off’ against the euro and dollar, as it strengthened to impressive levels against both in the run up to the Bank of England’s interest rate decision. The meeting minutes imbued the market with confidence that a May rate hike was a done deal and they piled into the pound some more. However, rather bizarrely, investors appeared to realise that they had already priced this move into the market and the pound promptly fell back. A pretty volatile day all told.
Retail sales were rather positive as, month-on-month, they beat forecast. They had been expected to come in at 0.4% but the actual figure was 0.8%; perhaps this has something to do with encouraged consumer spending as a result of a narrowing gap between inflation and wage growth. It is curious to wonder whether people actually notice the difference before the data is released and perhaps even curiouser to wonder whether they notice the difference after it is released. Year-on-year they had been expected to come in at 1.3% but they beat forecast again by coming in at 1.5%.
Today is fairly quiet although BoE’s Dr Gertjan Vlieghe is due to give a speech. It will be interesting to hear what he has to say.
