Respite For Sterling

The pound managed to make some gains, despite starting off the day on the back foot.

As European markets opened the pound slumped to fresh multi weeks lows against the single currency as it remained under selling pressure from traders following comments from Theresa May over the weekend on “hard Brexit”. Having hit a 9 week low and losing ground against the other main pairings the pound seemingly hit some technical downside support levels bouncing back off the resistance floor and managing to reverse some of its losses over the course of the day.

With a lack of any data of real importance, currencies were left to trader sentiment and having hit the low, it seems the only was up (baby) for the pound managing to gain over a cent against the euro and ¾ cent from the greenback. Against the more commodity led currencies the pound faired a little better, gaining nearly 2 cents from the Kiwi at its peak and 1.5 cents against the Aussie, although it didn’t manage to hold these gains, slipping half a cent back against both.

The only data release of any importance was Swiss unemployment which came at as expected at 3.3 percent, unchanged from last month. As a result, the Swissie took little benefit and ended up over cent lower against sterling by close of trade.
Today is a little more interesting on the ecostat front with UK manufacturing and industrial production plus trade balance figures at 9.30am this morning. The ECB are holding a non-monetary accounts meeting which shouldn’t throw up much
volatility with some low key domestic EU country releases over the morning. The only other major cause for concern as far as markets go, is the news conference from Donald Trump being aired at 4pm. This is classed as a highly volatile release so anyone with a currency requirement should make a note of the time and possibly speak to one of the Currency Index team early doors to avoid potential curveballs Trump may throw into the mix.