GBP

On Friday, Sterling remained stable against the dollar with no major movement for the pair as investors assess the latest developments surrounding the Russia-Ukraine conflict.

The data published by the Office for National Statistics showed on Friday that Retail Sales in January rose by 1.9% on a monthly basis. This reading surpassed the market expectations for an increase of 1% and helped the pound stay resilient against the dollar.

Investors have now continued to price in the expected interest rate rises throughout the year but there is also the possibility that they are pricing in more rate hikes from the Bank of England than the BoE is likely to deliver. Any disappointment could stem gains by the pound.

USD

Falling US Treasury bond yields also made it difficult for the dollar to gain any momentum. The benchmark of ten year US Treasury bond yield fell more than 3%.

This week investors will be keeping an eye on any movement from the potential invasion of Ukraine by Russia. Yesterday Putin was thought to be even closer to making a move as according to some intelligence, 75% of Russia’s conventional forces are now posted at the Ukrainian border.

EUR

The euro still struggles to gain any momentum back especially against the pound. As the BoE is set for another possible interest rate rise in March to combat the rising inflation in the UK, the European currency is facing tough weeks ahead.

Key announcements

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