Currency Note

Chancellor to deliver long-awaited Budget

By Sharyh Murray-Francis March 15th, 2023

Jeremy Hunt, Chancellor of the Exchequer is due to present the Budget today

On Tuesday, sterling hit a four-week high against the US dollar and maintains those weekly gains this morning. Against the euro, the pound is still strong compared to this time last Wednesday.

In business news, Meta, the company which owns Facebook, WhatsApp and Instagram has announced it will cut 10,000 jobs. This marks the second round of redundancies from the company following cuts to 11,000 jobs in November last year.

The latest inflation data rose 0.4% in line with market expectations yesterday which boosted America’s stock markets as a result. The Dow rallied approximately 500 points on Tuesday meanwhile the S&P 500 and Nasdaq 100 rose 2.1% and 2.5% respectively.

In European stock markets, the Stoxx 600 gained 0.6% on Tuesday afternoon while Germany’s DAX 40 gained 1%. This was also in the aftermath of US inflation and the collapse of Silicon Valley Bank. The positive boost was also reflected in the currency markets with EUR/USD hitting a four-week high yesterday.

Today the spotlight will be on Britain’s chancellor, Jeremy Hunt, who will deliver his Budget this morning. Investors will be digesting Hunt’s proposed changes throughout the course of today and watching out for any impacts on sterling.

In the US, the ones to watch will be PPI (monthly) and retail sales (monthly) which will both be released at 12:30pm. Both indexes rose in the previous data however markets are expecting those figures to decline today.

Tomorrow, it will be eurozone data that dominates markets. Euro-watchers will be watching closely for Italy’s inflation rate and Spain’s balance of trade. There will also be plenty of eyes on the eurozone’s deposit facility rate and the ECB’s interest rate decision.

Make sure any upcoming transactions are protected against the risks of sudden market movements. Secure a fixed exchange rate now with a forward contract; call your Business Trader on 020 7898 0500 to get started.

GBP: Wages vs inflation

According to the Office for National Statistics (ONS), regular pay in real terms fell by 2.4% in November to January in the UK. On the other hand, the growth in average total pay (including bonuses) was recorded at 5.7%. However, this still isn’t enough to prevent a loss as UK inflation remains high, at 10.1%.

GBP/USD over the past year

From To


EUR: France’s inflation rises

France’s monthly inflation rose by 1% this morning, pushing, French inflation to a five-month high.

The annual rate has also increased above market expectations to 6.3%, the highest rate in over three decades since May of 1985.

USD: All eyes on retail sales data

This morning market-watchers will gain an insight into US consumer spending with the latest retail sales data which will be released at noon. In the previous data release, retail sales in the US unexpectedly rose 3% month-over-month in January.

Today those numbers are expected to fall.

For more on currencies and currency risk management strategies, please get in touch with your Smart Currency Business trader on 020 7898 0500 or your Private Client trader on 020 7898 0541.