Sterling rally running out of steam

14 July, 2014

Rob Bastin

Last week’s trading saw sterling battling with ceilings of resistance as traders become more and more reluctant to buy the pound any further. Particularly in light of the poor data releases last week we in fact saw GBP exchange rates begin to fall from their multi year highs and showing all the signs of a short term negative correction in rates.

Friday’s trading was again absent of any key releases as the pound finished the week on a  negative slide. The only key data worth mentioning on Friday was for Canada as their employment rate cam in higher than forecast at 7.1% with their Net change in unemployment taking a surprise sharp drop. Needless to say the Canadian Dollar came under pressure in afternoon trading.

The week ahead sees some of the key releases for the UK and results will need to impress to avoid any sharp drops and the pound will be particularly vulnerable to weak data whilst sat at these peaks. The main economic releases to look out for are as below:

  • Monday 10:00am – Euro-zone Industrial Production
  • Tuesday 9:30am – UK Consumer & Producer Price Index1:30pm – US Retail Sales
  • Wednesday 9:30am – UK Unemployment figures (Claimant Count/Unemployment Rate)1:30pm – Producer Price Index3:00pm – Canada interest rate decision
  • Thursday 10:00am – Euro-zone Consumer Price Index
  • Friday 1:30pm – Canada Consumer Price Index