Sterling performed poorly yesterday, falling to a fresh 2014 low against the euro, as well as the lowest levels of the month against the US dollar. The main catalyst for the recent decline in fortune for sterling seems to have been the announcement by the European Central Bank (ECB) on Thursday 6th March to maintain interest rates at 0.25% whereas there had been talk of a cut. There is hope that data from the UK today can prompt a turnaround in fortunes for sterling.
Today’s release of minutes from the last Monetary Policy Committee’s monthly meeting could hold clues regarding how close the committee are to enacting an interest rate change in the future, while the official unemployment rate, which until recently was the benchmark indicator for rate changes, is also released today. The Annual Budget Release from the Chancellor of the Exchequer follows in the afternoon, which will outline government spending and borrowing levels; these announcements may impact the economic outlook of the UK significantly.
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