Yesterday was a difficult day for sterling.
First thing sterling gained a lot of ground against the euro as the European Central Bank reemphasised how it was committed to its programme of quantitative easing and how they would accelerate the program in the next few months so as to counter the lull that would happen over the summer months as Europe goes on holiday. Then the UK released their inflation figures which showed an unexpected downturn in UK inflation to -0.1%, the lowest we have seen since 1960, which then saw sterling struggle against the majority of its trade partners.
Sterling weakness against the US dollar was further accelerated thanks to positive building permit data from the States reaching its highest reading since 2008.
An important day lies ahead for sterling – thanks to the release of minutes from the latest meeting of the Bank of England policy committee; this will be scrutinised for any insight into future monetary policy. Minutes from the latest Federal Reserve meeting will also be released from the US Federal Reserve this evening as well, providing opportunity for further movement.