Mortgage approvals today gave sterling bit of bounce back against some losses yesterday as the amount in new loans exceeded expectations and suggest the UK is still on the right track, however GDP revisions tomorrow might be a better sign of how the UK is faring. Whilst we are not expecting any big revisions, and the data is for the final quarter of last year rather than anything new, there is a chance of them throwing up a few small surprises.
However there is likely to be a lot more movement towards the end of the week as we have German inflation and unemployment on Thursday, and wider European unemployment and inflation on Friday. The news here will be closely watched by markets because weak inflation could mean the ECB have to change tack and either do something with interest rates (difficult with them being so low already) or introduce an as yet unused tool (maybe something like Quantitative Easing in the US and UK). Neither option in my view is likely to be beneficial to the strength of the Euro in the short term so beware of the data on this basis as we could see big swings in either direction. If you would like to buy or sell Euro and would like some assistance please feel free to contact Colm at [email protected] or call 01494 787 478 and I would be happy to help.