A mixed day for sterling yesterday saw it push back towards its 22-month high against the euro while weakening off against the US dollar. Sterling finished the day having gained ground on the euro for the first time since last Wednesday as public sector net borrowing was shown to have decreased throughout June. Elsewhere, inflation in the US remained consistent, and with US existing home sales shown to have picked up, the US dollar pushed sterling further away from its recent highs.
Today looks set to be the most important of the week for sterling, with the release of minutes from the latest Bank of England (BOE) rate meeting and BOE Governor Carney’s speech later in the day. Investors will be looking for any indication that members of the Monetary Policy Committee may be growing uneasy with the low interest rate, and listening for Governor Carney’s reaction to recent strong economic data from the UK.