Yesterday was a fairly quiet day in the markets showing level trading across the board, with little market movement on GBP to EUR and USD. The day started off on a negative note for the pound with UK trade balance widening to 8.772B in the month of Febuary, therefore putting pressure on the pound for the first time in more than a week.On a slightly better note industrial production for the European Monetary Union grew by 0.5% after seeing a raft of negative data from the 4 major EU economies, showing that there is potentially light at the end of the tunnel.
Italy auctioned €2.88 billion of the €3 billion three-year bonds on offer at an average yield of 3.89% compared to 2.76% at a similar auction last month. This showed weakness in the euro currency.
In the US for the month of March unemployment eased slightly as 98,000 less people signed up for job seekers allowance ,however the good news was outweighed by producer price index coming out below expectations at 2.8 instead of the predicted 3.1%, limiting losses for the dollar.
Throughout the day GBP-USD struggled to reach 1.5950 even though the US trade deficit narrowed in the month of Feb.
Today could potentially be a hard day for the pound, with negative figures predicted for UK Producer Price Index at 08.30.
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