Currency Note

Pound stronger ahead of busy week for data

By Alex Bennett November 15th, 2021

Sterling is trading at stronger levels against the euro this morning ahead of a busy week of data releases.

The main event will be inflation figures on Wednesday, which are expected to show increases month-on-month and year-on-year. The markets will be watching closely to see if this data could impact action from the Bank of England. If inflation comes in as expected or higher, the pound could strengthen.

It’s also a packed week for economic data in the eurozone. Inflation figures are due on Wednesday, as well as a series of speeches throughout the week from European Central Bank officials.

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GBP: BoE Bailey to speak this afternoon

The pound is stronger against the euro this morning and is trading around the same levels against the dollar. This comes ahead of a busy week for economic data releases in the UK, as well as speeches from Bank of England officials.

This afternoon, Governor of the Bank of England, Andrew Bailey and other officials will speak in front of the Treasury Select Committee. The markets will be looking out for any signs about when interest rates may be hiked following the decision earlier this month to keep the rate the same.

Unemployment figures will be released for the UK tomorrow before consumer confidence and retail sales data on Friday. However, the most significant data release of the week will be on Wednesday, when inflation figures will be released. If this comes in higher than predicted, this could increase expectations for a rate hike in the near future.

GBP/USD chart over past year

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EUR: A packed week for data and ECB speeches

The euro is weaker against the dollar this morning ahead of a week packed full of economic data releases and speeches from European Central Bank officials.

President of the ECB, Christine Lagarde, is due to speak later today, followed by a speech from official Luis de Guindos. Lagarde will also speak tomorrow, Wednesday and Friday. The markets will be listening out for any comments concerning inflation and monetary policy in the eurozone.

Employment and GDP figures will be released tomorrow followed by inflation figures on Wednesday. Inflation is expected to rise 4.1% year-on-year.

USD: Retail sales figures tomorrow

The dollar is slightly weaker against a basket of currencies this morning after strengthening last week due to higher-than-expected inflation.

A virtual summit will take place this evening between President Biden and Chinese leader Xi Jinping amid rising tensions between the two nations. It is hoped that the summit will ease tensions, however, expectations for a solid outcome are low.

Retail sales figures will be released for the US tomorrow, which are expected to show an increase in October.

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