It was a poor day for sterling. At best it moved sideways against currencies like the US dollar, at worst it lost nearly one and half cents against the euro.
Yesterday’s major release was UK public sector net borrowing data where the amount rose to £8.58 billion in June, worse than forecast, from £8.35 billion in May. Greek banks re-opened on Monday after a forced three-week shut down. Greece also managed to repay the total of its arrears of near €2 billion to the International Monetary Fund (IMF), which helped the euro to regain some strength. Greece’s future in the Eurozone appears more secure.
Markets seem to be waiting for the release today of the minutes from the last Monetary Policy Committee meeting at the Bank of England (BoE). These minutes should provide comment and detail on how close we are to seeing increases in UK interest rates. Expectations are set for early 2016 so any reduction in that timescale could be a boost for sterling.