The major economic event this week that impacted sterling exchange rates was Manufacturing Production numbers released Tuesday morning. As expected the numbers stayed in negative territory at -0.3% for June and was down 0.6% compared to last year. Therefore the pound lost value throughout the week
Economic data this week and the Bank of England’s decision to cut interest rates and pump further quantitate easing into the economy justifies why the pound is continuing to fall against most of the major currencies.
Looking ahead I find it difficult to see how the pound is going to recover in the short term as post EU referendum economic data is showing a decline. Furthermore UK Prime Minister Theresa May has indicated she will address Article50 towards the end of the year or early next year and until this occurs uncertainty is surrounding the pound which is causing it to devalue.
This week the UK are set to release their latest inflation numbers at 9.30am on Tuesday. I don’t expect this figure to exceed expectation, however in months to come if the UK continue to pump Q.E into the economy inflation numbers should rise.
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