German inflation figures give a Euro boost

On a day with little to go on markets reacted to the only piece of noteworthy data in the form of German inflation figures. The reading came out at midday with a clean sweep of green, above expected readings. Whilst low key the business climate EU reading also showed an improved reading earlier in the morning so the euro had already started gaining a few pips against sterling and the US dollar. So with this key release showing an improvement of 0.3 percent on the year, compared to 0 percent expectation, the rally continued throughout the rest of trading. Over all the euro gained 3/4 of a cent against sterling and half a cent over the dollar.

Elsewhere the Canadian dollar gained 2 cents against the pound over the day as oil prices gained after US crude oil stocks showed an increase over expectations, following a bad day for oil the previous day. The Loonie is well tied to the price of oil as a major producer and exporter to the US, as well as being a commodity currency. On this basis, we also saw strong gains for the Aussie (over 1 cent) and the Kiwi dollars (3 cents) as markets opened yesterday, as well as a 1 percent gain for the oil led Norwegian Krona.

Today should be more ecostat led as we have key figures in the form of German unemployment, UK GDP, business investment and money supply, along with EU inflation figures this morning. After lunch we see Canadian GDP released and US PMI before a speech from the Bank of England governor Carney this evening. As such, if you have a transfer to make it could be prudent to trade sooner rather than later in case any of the stats today or the speech overnight dent an already ailing pound. Contact one of the team today to discuss the available options.