Markets see an uplift in Sterling sentiment

GBP Sterling recovered from recent lows against the dollar on Monday to trade at its strongest level for two weeks against the US currency. The appreciation in the British currency follows an uplift in Sterling sentiment which stems from a positive end to the previous week. Last week saw UK Retail Sales surpass market expectations, … Read more


Higher prices push consumers to stay at home

Sterling ended the week firmer on Friday with the currency benefitting from a better than expected Retail Sales data release. According to the data released by the Office for National Statistics, UK Retail Sales defied market expectations of a -0.2% contraction, instead growing to 1.4% in April from 1.2% in March. The data suggests the … Read more


Major US retailers warn of consumer driven recession

USD The pound took advantage against the US dollar yesterday after falling to multi-month lows last week. The move is somewhat strange as it comes off the back of a slump in global equity markets, which normally means that the dollar is used as a safe-haven in times when investor sentiment declines. Investor sentiment declined … Read more


UK inflation is at forty-year high

GBP CPI in the UK rose by 9% in April year-on-year, a fresh forty-year high and yet another worrying print for the Bank of England. While the figure has provoked many tabloid headlines, financial markets had expected a slightly higher reading of 9.1% today, leaving Sterling relatively unchanged to lower post-release. With CPI expected to … Read more


Lockdowns ease in China is boosting investor sentiment

GBP The pound strengthened on Tuesday against both euro and US dollar after strong labour market data. The unemployment rate dropped to 3.7% from 3.8%, which is the lowest level in fifty years. The UK added 83k jobs in the three months to March, 5k more than the market expected. Average earnings, with bonuses included, … Read more


Bank of England Governor warns of apocalyptic food prices

The health of the global economy appears to be frail after China’s retail sales fell by over 11% in April while its industrial production contracted by 2.9%. Both readings are the worst since the start of the pandemic in 2020. The Chinese economy looks set to shrink this quarter due to the country’s lockdown policy … Read more


NI Protocol poised for a change ahead of crisis talks

GBP The pound was up against the US dollar on Friday after a week of selling which had pushed the currency to two-year lows against the USD. Sterling was up 0.21% a day after falling despite disappointed data points to a weakening British economy. UK data for last week was poor due to several factors: … Read more


UK GDP growth disappoints as quarterly figure shows little progress

GBP UK GDP for the first quarter came in below expectations, with the quarterly figure rising 0.8% against the 1.0% expected. Given last week’s monetary policy report from the Bank of England, this further reiterates the view of policymakers that growth will slow down throughout the year. Economic growth will take a bigger hit in … Read more


Global markets fell in the wake of US inflation data

USD The dollar rallied on Wednesday and held near a two-decade high after US inflation moderated less than markers had expected, keeping the Federal Reserve on course to tighten policy aggressively. The Consumer Price Index climbed 8.3% on an annual basis in April, easing from 8.5% in March but outstripping the 8.1% estimate from economists. … Read more


Market sentiment is driving GBP rather than economic data

GBP Sterling had a mixed day against both the euro and US dollar on Monday. A lack of economic data meant the British currency was largely driven by market sentiment. This was welcomed by Sterling investors whom up until Monday had seen the pound fall on a day by day basis, as investors are dealing … Read more


Markets watch out for Putin’s Victory Day speech

GBP The pound enters the week losing value against both the US dollar and the euro amidst an ongoing backdrop of deteriorating global investor sentiment. Investors continue to sell in the wake of the Bank of England’s cautious rate hike. Although interest rates rose by 25 basis points, the overall economic outlook looks bleak. Sterling … Read more


Warning of UK economy downturn as interest rates rise

GBP Sterling fell by approximately 2% against both the euro and US dollar on Thursday as the Bank of England warned of a recession and that inflation could peak at 10% by the end of this year. Policymakers opted to hike interest rates in the UK by 25 basis points, taking the main lending rate … Read more


Interest rates increase expected for the UK and US

USD The dollar fell on Wednesday evening following the Federal Reserve interest rate decision. Dollar bulls were disappointed as the Fed seemingly ruled out the imminent prospect of hiking interest rates in increments of more than 50 basis points. Instead the Fed unanimously opted to hike interest rates by 50 basis points to a range … Read more


Markets await the Fed’s decision on interest rates

USD This morning GBP/USD is trading close to two-year lows and USD/EUR is approaching five-year highs. Later today the Federal Reserve will release their latest monetary policy statement, interest rate decision and provide forward guidance. They are expected to raise rates by 50 basis points, which has been projected in the markets. There is also … Read more


The Bank of England expects headline inflation to top 8%

GBP The Bank of England is expected to raise interest rates further in the second quarter of 2022 as the UK central bank tries to fight soaring prices pressures. The BoE has already lifted the bank rate to 0.75% from 0.1% in late 2021 and money markets are currently pricing in 125 basis points of … Read more


Recession fears grow globally

GBP The pound hit twenty-one-month low as US dollar hits two-decade high against other major currencies. The pound dropped against USD as concerns over the UK’s economic health continue to grow. Traders are anxious as the British economy is being hit by weak consumer confidence, a cost of living crisis, rising input costs and supply … Read more


Russia threatening EU states with restrictions on gas supply

EUR The euro came under renewed pressure yesterday, as Russia cut gas supplies to Poland and Bulgaria. The threat from Russia of further restrictions on gas prompted five year lows for the euro against the US dollar and a reversal of gains against the pound. Russia signalled that its decision to halt gas supplies to … Read more


China’s continued lockdowns threaten global growth

GBP The pound continued its losing streak on Tuesday as global investor sentiment turned sour and fears of the UK economy could suffer a recession are increasing. In addition, Sterling was pushed down further by a stronger US dollar benefitting from safe-haven flow. The pound is currently one of the worst performing of the world’s … Read more


US dollar continues to outperform its main rivals

GBP Sterling fell on Monday to its lowest level since September 2020, continuing to nearly hit two yearly lows against a strengthening US dollar. Money markets have scaled back their bets on future monetary policy tightening from the Bank of England as they are now expecting the central bank to not raise interest rates as … Read more


US dollar draws support from fresh leg up in treasury bond yields

USD In Washington, US President Joe Biden has authorised a further $800 million in military aid for Ukraine including heavy artillery, citing a “critical window” in the conflict as Russia has now retreated from the Kyiv area. The Federal Reserve may now take a step back from its extremely hawkish stance on beating inflation. The … Read more