Pound running out of steam

Yesterday morning’s data releases saw a raft of positive CPI data from Spain and also industrial date from the Eurozone – although releases not of any major note it was enough to tip the currently finely balanced scales and help the single currency gain almost half a cent against the pound which seems to have least at present run out of steam. Indeed in the last few days the USD which has been flagging in recent weeks has also clawed back a couple of cents against the pound. In the short term at least the pound is now the worst of the picks from the majors and is struggling to hold ground. 

It is an interesting mix as whilst the USD and Euro would seem relatively weak at present they are gaining. Without doubt in recent months the pound has been somewhat spoilt with positive data releases, so perhaps this is just a glitch following recent strong non-farms data for the USD and the slight shock announcement from the ECB last week?

But whilst the BoE are still standing firm on forward guidance on no more Q.E, the Eurozone boldly announce that all is fine…. so is perhaps the pound running out of steam? 

Today is silent in the way of UK data, however this morning we have the ECB monthly report and this afternoon sees USD retail sales released. Albeit quiet for the pound we may see some movement as the ECB report could galvanise last week’s comment and see the Euro steal further gains, whilst US retail sales will be a telling sign of ongoing debt issues and their currently unknown road to recovery.

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