The Pound strengthened yesterday afternoon during Chancellor Phillip Hammond's Spring Statement where he hailed Britain's growth and deficit reduction figures. Hammond unveiled a boost in public finances due to lower government borrowing forecasts, slightly stronger growth and higher tax receipts.
The Office for Budget Responsibility (OBR's) forecast for GDP growth was raised slightly in 2018 to 1.5 per cent, from 1.4 per cent, but growth is still forecast to fall to 1.3 per cent in 2019 and 2020. In spite of the weakening growth outlook, Hammond described himself as "positively Tigger-like" in his optimism and said he "would have capacity for further spending" if the economy continues to grow.
The government will borrow £45.2bn in the 2017-18 fiscal year, £4.7bn lower than previously thought, he told Parliament during his Spring Statement. He said the predicted falling debt load as a percentage of GDP in the 2018-19 fiscal year marked a "turning point in this nation's recovery", although a big question mark remains over the effects of Brexit.
The OBR also estimated the UK will be paying its Brexit divorce bill until 2064. They put the final figure at £37.1bn - squarely in the middle of government estimates of £35bn-£39bn.
Consumer prices in the US increased marginally in February despite a decline in gasoline prices and a moderation in the cost of rental accommodation, the latest indication that an anticipated pickup in inflation likely will be only gradual.
Strong inflation numbers in January had sparked fears that price pressures were accelerating, leading financial markets to expect a more aggressive pace of interest rate increases from the Federal Reserve than is currently anticipated.
08:00 – EUR - ECB President Draghi Speaks
12:30 – USD - Core Retail Sales expected to increase to 0.4%
12:30 – USD – Producer Pricing Index forecast to decrease to 0.1%
12:30 – USD – Retail sales projected to increase to 0.3% from -0.3%
14:30 – USD – Crude Oil Inventories