Daily Currency Update

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Quiet week for the UK with the focus instead on the Federal Reserve

GBP - British Pound

It is set to be a quiet week ahead for the UK on the data front with little to report. Last week did see the release of retails sales figures which surprised to the upside beating forecasts. Thanks have to be said to the Euros and whilst football didn’t come home, plenty of food and drinks did, helping to contribute to the release. For the pound last week it was rather similar to the rugby at the weekend, a game of two halves, with sterling on the back foot against the US dollar and euro until Wednesday lunchtime. The second half of the week was a recovery for the pound erasing much of its losses. This week though any further upside gains could be limited by the ongoing dispute between Whitehall and Brussels over the Northern Ireland protocol.

Key Movers

For the pound there is also the rather sticky issue of the Federal Reserve meeting later this week. The Fed meeting is set to be the focus of investors this week as it grapples above trend growth and inflation. Whilst the Fed isn’t expected to provide a detailed timeline of when it could taper its ultra-loose monetary policy any rhetoric around the issue will underline the US dollar. As for the euro, the single currency seems to be acting as the last bastion of defence against the surging US dollar which has left no major currency untouched in its recent performance. This has led some analysts to wonder whether EUR/USD may have found its technical base at 1.1750. Let’s wait till Wednesday to find out.

Expected Ranges

GBP/USD: 1.3600 - 1.3800 ▲

GBP/EUR: 1.1620 - 1.1700 ▲

GBP/AUD: 1.8620 - 1.8750 ▲

EUR/USD: 1.1750 - 1.1830 ▼