GBP - British Pound
The UK saw its final Q1 GDP results yesterday showing a 1.6% contraction instead of a forecasted 1.5%. The UK economy is expanding going into Q2, however, there are still several factors to consider going forward, especially with the delta variant still having an impact across the UK, with the final reopening still delayed until the middle of July.
Bank of England Governor, Andrew Bailey, is due to speak later today. Bailey's speech is expected by some foreign exchange analysts to touch on the outlook for the UK monetary policy and could provide some guidance as to whether the BoE is considering bringing forward the timing of the first interest rate rise.
Any hint of an earlier interest rate hike could potentially push GBP higher and provide better exchange rates for those looking to sell the pound and buy euros, dollars and other currencies following a period of underperformance for the UK currency.
Yesterday Eurozone inflation data showed a fall to 1.9% from 2.0% in the prior month, matching forecasts. Meanwhile, the core reading held at 0.9%, again, in line with the forecasted rate.
The overall rise in core inflation stemmed from an increase in core goods inflation to 1.2%, with services falling slightly to 0.7% from the prior month. The inflation data is unlikely to prompt the ECB to change their view that monetary policy must remain accommodative, which could lead to more pressure on the euro.
1.3815 - 1.3845 ▲GBP/EUR:
1.1655 - 1.1675 ▲EUR/USD:
1.1825 - 1.1860 ▼