In another quiet day for GBP/EUR trading, the single currency made up some of the losses that it suffered earlier in the week. Sterling came under pressure as the FTSE 100 had a sluggish day, finishing 0.1% lower after it gained some support from Wall Street later in the day, as investors remain cautious about taking on too much risk ahead of the Easter Weekend. The single currency’s gains were reigned in, however, as recent economic news has been so poor from the eurozone. News out of the UK was little better, as consumer confidence slipped in March as people worried about rising unemployment during the recession.
The major economic news today will surround the Bank of England’s interest rate decision due at 12.00 BST. The Caxton FX analysts are forecasting that the central bank will keep rates on hold at the record low of 0.5%, whilst continuing the quantitative easing programme that commenced last month, as the Monetary Policy Committee looks for signs that their drastic action is taking affect.
Trade balance figures are also released within the UK this morning, alongside the Producer Price Index giving an indication of inflation at present. Germany also releases its industrial production figures, an industry that has been particularly hard hit for them in the past 12 months.
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