GBP/EUR remained within a one cent range last week hitting a high of €1.1352 and a low of €1.1251, with a lack of Brexit developments and not major data points being published last week this was an expected move for the cross to be stuck within.
Let’s look at the week ahead as there will be some more important releases this week that may affect Sterling and how much you pay for your currency.
The day started with some minor points from the Eurozone, at 9:30 we have the main release of the day with the UK’s Current Account and Final GDP figure being published. Any improvement on the anticipated could give the Pound a small boost.
The first of the UK’s PMI’s (Purchasing managers index) is released today. Manufacturing PMI is due out in the morning and is due to show further contraction, this could be classed as a negative to the Pound. There is also Manufacturing data for the Eurozone as a whole, Canada and the US today. There are also 3 speeches from FED member’s today, if they touch on monetary policy the USD could react.
A quieter day today with only UK Construction PMI and US Crude oil inventories due for release. Construction PMI is, again, due to show contraction coming in at 45.0. Another piece of evidence that Brexit is starting to affect the UK’s economy.
The 3rd instalment of PMI is due to today in the form of Services PMI. This is due from Italy, Spain France, Germany, the Eurozone the US and the UK. This is classed as the UK’s most important PMI as the Service’s sector makes up around 75% of the UK’s economy. This is expected to hold just above 50 and showing expansion, if this drops below, I think that the Pound would drop off on the back of the news.
No UK data today so you can expect limited movement in GBP today. There is a slew of US data in the afternoon which would make the USD exposed to volatility. Unemployment rate, Average Earnings and Non-farm pay roll figures are printed at 1:30 UK time. Non-farm figures usually deviate quite dramatically from the expected figure and this causes some big swings in US crosses. There will also be some more key speeches from FED members later in the evening including the FED chair Jerome Powell. Investors will watch his speech closely, and you can expect a classy tweet from President Trump once he has spoken.