• Home
  • Blog
  • British Pound: Positioned as a Sitting Duck This Week, Yet Potential Benefits Await

British Pound to play sitting duck role this week, but it could prove to be beneficial..


Sterling had a good week last time out after suffering for the majority of April beforehand. £-€ recovered 1% and has importantly held its position over the weekend and £-$ clawed back 1.5%. But both currency pairs have very different forecasts from here..

Traders are struggling to see much upside in GBP  v EUR at the moment and its easy to see why. The pair has been oddly 'well-behaved' so far this year, barely drifting from an extremely tight trading range of 1.16-1.1750 mid-market. Anything above 1.15 is deemed favourable by most (especially compared to last year) and Sterling has comfortably and consistently been above this level most of the year. 

The problem is, September 2022 was the last time £-€ was any higher than it is currently. For the rate to go higher and consolidate there, it is going to need something special. If the ECB move faster than the BoE and by more on cutting interest rates, this could do it, but ifs and buts versus past performance will never win in this game..

With GBP v USD, traders only see downside. This is mainly down to how well the US is coping with higher interest rates, If the BoE cut interest rates before the Fed (now likely), we could eventually see the £ plummet to the 1.20's and beyond like we did in October/November last year. 

We have a 'super Tuesday' from the Euro-Zone this week which means we will likely see wild volatility on the day and days after. Because of the sheer number of economic releases and there importance, it's anyone's guess what happens to the Euro this week. 

The German data alone are market movers, but with EU inflation & GDP offered at the same time it could be fireworks..

It's all eyes on the Fed this week to see firstly if they surprise markets with an interest rate cut (unlikely) and then to see if monetary policy stance has shifted (again unlikely). It could prove to be a bit of a non-event, but I wouldn't be betting on that to happen. 

The US also offers jobs, confidence and PMI data to ensure we are in for an intriguing start to May..

Upcoming Data
Monday 29th April 2024
13:00 EU - German inflation 
20:00 US - Treasury refunding financing estimates 

Tuesday 30th April 2024
05:30 EU - Dutch inflation
07:00 EU - German retail sales
07:45 EU - French inflation
08:00 EU - Spanish GDP
08:55 EU - German unemployment rate
09:00 EU - German & Italian GDP
09:30 UK - Mortgage approvals & lending
10:00 EU - Euro-Zone GDP & inflation
10:00 EU - Italian inflation
13:30 US - Employment cost
14:00 US - House price index
15:00 US - Consumer confidence 

Wednesday 1st May 2024
07:00 UK - Nationwide housing prices
12:00 US - Mortgage applications
13:15 US - Employment change 
13:30 US - Treasury refunding announcement 
15:00 US - Manufacturing PMI & construction spending
19:00 US - Fed interest rate decision & press conference

Thursday 2nd May 2024
08:15 EU - Spanish manufacturing PMI
08:45 EU - Italian manufacturing PMI 
13:30 US - Balance of trade & initial/continuing jobless claims
15:00 US - Factory orders

Friday 3rd May 2024
07:45 EU - Industrial production 
08:00 EU - Spanish unemployment change  
09:00 EU - Italian unemployment rate 
10:00 EU - Euro-Zone unemployment rate
13:30 US - Non-Farm payrolls, unemployment rate  average earnings
15:00 US - Services PMI