Daily Currency Report

Overview

Rising inflationary pressures provide the dominant theme for this week's market data releases. All eyes are focused on the BoE minutes for clues as to which direction the pound will take.

GBP

The sterling took its direction from moves in other major currencies. The pound lost against its two-year high against the dollar, as British police foiled a plot to blow up transatlantic flights. Despite this, there remains an underlying support for the pound, which rallied in the wake of the Bank of England's surprise rate hike last week.

USD

Last week the Fed kept its rates at 5.25 per cent, a move that ended a sequence of 17 consecutive rate hikes. However, the door is still open to future rate hikes.

EUR

The release of the flash estimate of eurozone gross domestic is expected to show the eurozone economy grew 0.7 per cent from the previous quarter.

JPY

The yen dropped to a two-week low against the greenback after GDP data printed materially weaker than expected. Thus, the Bank of Japan decided to keep interest rates on hold.

Compiled by Commercial Foreign Exchange Travelex Malta. (Free phone: 800 77 33 22) www.travelex.com.mt

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