Breezy pound awaits BoE’s minutes

Yesterday saw some significant international data releases, which had implications for all of the major currencies. The Pound took some initial strength from inflation figures that came out first thing, but was hauled back by the Euro, which itself took significant strength from comments Mario Draghi made, seemingly indicating that the ECB has a strategy in place to deal with any problems and is even prepared to use “non-standard measures” to protect and stimulate the European economy. As the Euro strengthened it pushed the Dollar down, as investors shifted their positions back to the single currency, giving many currencies a chance to claw back some of the gains the Dollar had made over the previous session. This was also aided by some less than impressive housing numbers from the US as well. There are a couple of important data releases coming out today – in the UK we have the BoE minutes being released this morning at 9.30am and then in the US we have the FED’s monthly policy decision and the accompanying statement this evening at 7pm. The Bank of England minutes will be very interesting, as we wait to see if the MPC vote has changed from 6 against and 3 in favour of more Quantitative Easing. Comments earlier this month from the Bank seem to have for the moment halted any chance of more QE and if this is backed up by today’s minutes, then the Pound could take significant strength from this. The FED announcement is not particularly expected to give us much in the way of exciting news, so on this front it is more important to watch for surprises that could influence the markets movement, as this is still obviously one of the major monthly announcements. Through all of this make sure you stay in close contact with your CI account manager to be kept informed of the data releases and their resulting impacts on the market, and how they might affect your decision on send money aboard