Sterling has remained under pressure against the euro, with political uncertainty in the UK adding to softer sentiment. As we move through the week, a series of major UK and US data releases could set the direction for currency markets.
Latest market insights:
- Tuesday – US Retail Sales:
US Retail Sales figures are released on Tuesday. As a key indicator of consumer spending, this data offers insight into the overall health of the US economy. Stronger-than-expected numbers could support the US dollar, while weaker figures may raise questions around economic momentum. - Wednesday – US Labour Market Data:
Attention then turns to US Unemployment Rate and Average Earnings data. Employment and wage growth are closely monitored by the Federal Reserve when assessing interest rate policy. Expect potential volatility in currency markets on Wednesday afternoon as the data is released. - Thursday – UK GDP & Industrial Data:
Thursday brings UK GDP, alongside Industrial and Manufacturing Production figures for December. These releases will provide a clearer picture of how the UK economy closed out the year.
At the Bank of England’s most recent meeting, the vote was more closely split than many had anticipated. That has fuelled expectations that a rate cut could come sooner rather than later, which is continuing to weigh on sterling.
As always, periods like this can create both risks and opportunities in the FX markets. If you have upcoming currency requirements or would like to discuss how these events could affect your plans, we’re here to help, contact Lumon on +44 (0)204 506 5672 for a free, no-obligation conversation and discover what options you have available to help.
