Last week I said in my post that I thought the Pound would have a fairly good week and that prediction came true, by even more than I originally thought it might.
This movement was mainly down to a higher inflation reading on Tuesday, great unemployment figures on Wednesday and Then the Bank of England talking up the chance of an interest rate hike on Thursday.
Investors and speculators alike all jumped into the Pound as the week progressed and we hit multi month highs against numerous major currencies.
One way to help solve high inflation is to consider raising interest rates and an interest rate hike is generally seen as positive for the currency concerned, markets had predicted we would not see a rate hike until 2019, however the BOE comments have bought expectations to the coming months.
One thing we need to remember is that the BOE have not actually done anything, they have merely mentioned that they might, so this latest spike does have the potential of being short lived.
Retails Sales figures on Wednesday morning will be the next big point of note and expectations are for a small drop off, should we see this release come out better than expectations then the Pound may well have yet another push forward, equally if Retail Sales do disappoint then we may see the slight drop off we have seen today continue.
Friday brings a Brexit speech from Theresa May which will be also extremely important and depending on how the markets take it we may well have a fairly volatile end to the week.