GBP

The pound rose against the dollar this morning after inflation data beat expectations. UK inflation jumped to 2.1% in May, far better than the expected 1.8% and a healthy growth from April’s 1.5%. GBP/USD had been at a one month low yesterday.

However, there’s a feeling among economists this spike is temporary, similar to those seen across the world and fueled by global commodity price rises. It’s likely the figures will run hot whilst this is happening and the Bank of England will wait longer to assess the long term impact. Tuesday’s labour report did show there has been wage growth. This will be of greater interest to the central bank at this point.

Key announcements

10:00 – EUR- ECB’s De Guindos Speech
19:00 – USD – Fed Interest Rate Decision & Economic Projections
19:00 – USD – Fed’s Monetary Policy Statement
19:30 – USD- FOMC Press Conference