- Sterling slips ahead of Gross Domestic Product data but may rebound
- US Gross Domestic Product data later in the week
By David Johnson
A very Happy St George’s Day to one and all. It’s odd that St Patrick’s Day has Guinness and St Andrew’s Day has Scotch, but we have no particular tipple for St George’s Day. Pimms, perhaps, or maybe something more refined; tea and scones or strawberries and cream? Either way, I hope you have a good one.
Sterling slides, but not too far…
Sterling slipped off its pedestal at the end of last week but didn’t fall far. The Pound starts this week around $1.40 and around €1.14. A few weeks ago these would have been considered healthy levels to sell GBP, but the recent spikes have made us complacent perhaps. These are definitely better for GBP buyers than we have seen of late.
Whilst there is nothing of note today, the week ahead will bring a number of Sterling-moving events. The Confederation of British Industry (CBI) Industrial Trends and Retail Sector surveys are due this week, along with government borrowing data, a consumer confidence survey and the first estimate of Britain’s Q1 Gross Domestic Product (GDP) growth. All are significant and all look set to be slightly on the positive side, if the forecasters have got their sums right.
European data could move markets this week
There is also plenty of EU data this week. All the Purchasing Managers’ Indices (PMI) are due today and we’ll get an interest rate decision from the European Central Bank (ECB) on Thursday. We will round the week off with the Industrial and Consumer Confidence Indices. The Euro is quite quiet at the moment, though, so it may take something out of the ordinary to shift the shared currency.
Barrage of US data also expected
US data is also thick on the ground. The USD has strengthened a little in spite of some featureless speeches from Federal Reserve members last week. A flurry of data will assail us from the land of cowboys and orange presidents this week. This afternoon and tomorrow afternoon brings US housing sector data and we will see consumer confidence data tomorrow as well. That is forecast to be slightly weaker. The biggie is the preliminary economic growth figure, which we will see on Friday. The forecasts are for a fall from 2.9% last quarter to something below 2% in Q1. The US Dollar will weaken if that is true.
Other data due this week will include Australian Consumer Inflation and Producer Prices. All are forecast to be positive for the Australian Dollar.
And it is Hay Fever season (don’t I know it!) but Asthma UK has carried out a study that finds Gin and Tonic can relieve the symptoms of hay fever. That’s all we need to hear. That your excuse; now off you go to do your own research. Chin Chin!