The pound seems to be gently pushing forward as confidence over an interest rate hike keeps the pound elevated against its counterparts. Sterling is higher against pretty much all currencies bar the US dollar which itself has been much stronger in the last week as investors confidence in the US economy rose. The next stage post for the pound is tomorrow’s UK GDP (Gross Domestic Product) data which could easily be a market mover.
Tomorrow’s news will be the first estimate of Q1 GDP. This is vital since it is the first snapshot of the figures over how the UK economy has been operating in 2018 so far. Most analysts expect the bad weather to have caused a slowdown, this was evidenced by many other data sets and did see the pound struggle earlier this month as the data became apparent. Tomorrow’s news could easily upset the current confidence if it comes in lower than expected.
The next big pieces of economic data will definitely be the interest rate decision on the 10th May which will provide some clarification of what the market can expect moving forward from the BoE (Bank of England). I expect next week to be dominated by a focus on the BoE and just how they will be acting in the long run.
Markets have been pricing in the interest rate hike but this is not a guaranteed outcome, the recent commentary by Mark Carney had given the market reason for caution seeing the pound fall. If you are looking to buy or sell the pound then the next couple of weeks will be crucial to helping plan and manage to secure the very best rates of exchange.
For more information on target exchange rates and the up to date forecasts please speak to me Jonathan Watson by emailing [email protected]
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