As we mentioned this time last week, Sterling found itself in overbought territory and a correction was therefore the most likely scenario. This has now played out with £-€ falling 0.5% from its recent high and £-$ dropping 0.8% in the same time-frame.
Still, the Pound trades very favourably across the board and the outlook both near & long term looks overall positive. Sterling was also impacted last week by investor sentiment and a fall in the stock market, both of which may plague GBP again this week.
Growing fears of a China-US trade war, a Trump presidential victory, a major global IT failure, a CHAPS banking issue and a poor UK retail sales result have all played their part in devaluing the Pound of late. A stock market sell-off was one of the results of investor sentiment turning sour because of said events.
The only thing of economic note for the UK this week is the PMI's. A steady result is expected which could provide a small boost for the Pound in a week that will see it being moved by events elsewhere.
EUR The ECB interest rate decision and following press conference were as expected non-events for financial markets. Data will set the stage for a September decision and there is a long time until we reach that point. This takes a headwind off of the Euro for a moment which may benefit the single currency.
USD The Dollar rallied last week because of its safe-haven status in the midst of various things going 'wrong' in the world. President Biden's decision to step down over the weekend could provide some USD weakness though between now and election day if Trumps odds of success start to shrink.
This week, the US offers the most important economic releases with PMI, jobs, GDP & inflation all being released. Upcoming Data | Monday 22nd July 2024 | N/A
| Tuesday 23rd July 2024 | 05:30 EU - Dutch consumer confidence 15:00 EU - Euro-Zone consumer confidence 15:00 US - Existing home sales |
Wednesday 24th July 2024 | 07:00 EU - German consumer confidence 08:15 EU - French PMI 08:30 EU - German PMI 09:00 EU - Euro-Zone PMI 09:30 UK - PMI 10:30 EU - 10-year bund auction 12:00 US - Mortgage applications 13:30 US - Goods trade balance & retail inventories 14:45 US - PMI 15:00 US - New home sales |
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| Thursday 25th July 2024 | 07:45 EU - French business confidence 09:00 EU - German business climate 11:00 EU - French unemployment claims 13:30 US - GDP, durable goods, initial/continuing jobless claims 16:00 EU - ECB President Lagarde speech |
| Friday 26th July 2024 | 07:45 EU - French consumer confidence 08:00 EU - Spanish unemployment rate 09:00 EU - Italian business & consumer confidence 13:30 US - PPI, personal income/spending |
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