Sterling pushed higher against the euro on Friday as the UK trade deficit in goods and services narrowed to £2bn in October. Exports rose by £2.1bn to £26.8bn, the highest level since records began in 1997 – a strong foundation for growth in Q4! Sterling remained steady against the Greenback.
There are lots of international economic events lined up for this week. Businesses will mainly focus on the Federal Reserve’s FOMC’s interest rate decision and statement. Expectations are for a 0.25% interest rate hike. There’s more to this meeting, though, as markets will interpret the tone of the statement to get a better idea of further rate hikes.
UK data releases kick off with the nation’s key inflation reading on Tuesday. This is a closely watched figure by both the public and the markets. Wednesday sees unemployment data, with the claimant change and salary growth the key features. Finally, on Thursday, we have retail sales data and the Bank of England meeting.
All in all, with the year coming to end, it is likely that we could see increased volatility as investors close out positions for the year before the holiday season, so get in touch with your currency specialist to discuss locking in exchange rates before this week’s major events.