Home Daily Commentaries Spring budget comes into focus for GBP

Spring budget comes into focus for GBP

Alex Hartley
Written by
Alex Hartley

Alex Hartley

OFXpert

Driven by a passion for currency markets and data movement, Alex finds great appeal in the dynamic nature of the industry.

| Tuesday 5 March, 2024

Daily Currency Update

Macroeconomic data was scarce yesterday with only ‘lightweight’ data from Europe released. Spanish data showed unemployment fell by 7,452 people in February and stood at 2.76mio, the lowest figure since 2008. Switzerland's CPI m/m showed inflation picked up greater than expected (0.6% versus 0.2% previously) providing a case for its central bank to cut interest rates. The lack of data meant FX volatility was subdued with the key pairings remaining range bound. GBP/USD touched 1.2710 after midday but trades back down at 1.2675. GBP/EUR made a break for 1.1700 but remains under this big figure this morning. EUR/USD is under 1.0850.

Overnight, data showed UK retail sales growth slowed in February. The bad weather was highlighted as a reason, alongside high borrowing costs and inflation. The remaining data for Tuesday come from Europe and the US, in the form of Services PMI from both locations. Market participants’ eyes will remain firmly on the bigger data announcement expected on Wednesday.

Key Movers

Sterling has recently been range-bound against a few currencies of recent, waiting for the next big data announcement to sway the currency movement. Wednesday could be the catalyst for this movement as the annual budget release is delivered by Chancellor Hunt. Early signs for the Spring budget point to it being fiscally responsible with small tax cuts, which would limit the impact on the market. However, could remain the focus of what has been a quiet start to the week.

Expected Ranges

  • GBP/USD: 1.2660 - 1.2710 ▲
  • GBP/EUR: 1.1670 - 1.1700 ▲
  • GBP/AUD: 1.9420 - 1.9690 ▲
  • EUR/USD: 1.0830 - 1.0880 ▼

Written by

Alex Hartley

OFXpert

Driven by a passion for currency markets and data movement, Alex finds great appeal in the dynamic nature of the industry. With over 20 years of experience, Alex works closely with businesses to understand their foreign exchange requirements and align them with solutions. Placing a strong emphasis on customer service, he takes pride in nurturing long-lasting relationships with clients.