Sterling ended last week in the same vein it had all week – with mixed movements dependent on data releases or news from other countries. Better-than-expected employment data on Friday from the US pushed sterling lower against the dollar, but the data also triggered a broad sell-off in the euro which meant that sterling was able to recover some of the ground previously lost against the single currency.
The week ahead will see little fundamental UK economic data released. On Tuesday we have the release of BRC retail sales for May which are expected to be back in positive territory. Wednesday sees the release of manufacturing production figures for the month of May, and these are forecast to fall to 0.1% – but investors will be hopeful of a better-than-expected figure, given the previous positive Purchasing Managers’ Index reading from the manufacturing sector. Wednesday will also see Bank of England Governor Mark Carney speaking, and as ever, any new clues regarding future monetary policy will be eagerly awaited. Aside from this, data on industrial and construction output will also be released, although there are likely to have a muted impact.