Last week was a good week for sterling with it gaining ground against most currencies. The only currency where the gains were muted was against the euro – which is difficult to understand given the problems with the Greek debt negotiations and fast approaching deadlines. Perhaps investors can’t believe the politicians would be so stupid as to allow the Greeks to leave the Eurozone. We wait and see if this assumption is correct.
This week there is little in the way of influential UK data to be released. While mortgage approvals on Wednesday, and lagging retail sales data from the Confederation of British Industry due on Thursday, this data is unlikely to have significant impact on sterling. Instead, the markets will be watching for the release of industry growth data from the Eurozone, and the final confirmation of US economic growth throughout the previous quarter.
With the Greek debt situation still far from resolved too, we expect to see sterling movement dependent on how talks progress between Greece and her creditors.