020 7898 0500It was a quiet end to the week which gave the markets time to pause after what had been a busy week. The only point to note was comments from Chancellor Philip Hammond. He stated that any ‘transitional deal’ in the period after Brexit should be concluded before the next election.
Looking to the week ahead there is some significant data and event risk to sterling. On Monday, we have the lending and mortgage approvals. A key highlight of the week will be the release of the purchasing managers’ indices for the manufacturing, construction and service sectors. These are set for release on consecutive days, Tuesday through to Thursday, with the highlight on the dominant service sector.
Meanwhile, the highlight and big event risk will be the BoE interest rate decision and quarterly inflation report. Last time around there was a surprise as three members voted for a hike. As a result, the voting pattern will be closely watched. In addition, BoE Governor Mark Carney is due to speak during the release of the inflation report. His rhetoric will be deciphered for clues on future monetary policy. Due to the inconsistent comments from voting members this could result in some volatility in the pound.
