Key data week ahead
It's another busy week on the data-front and the Pound is hoping for good news from the UK figures. £-€ rates are trading 0.3% up on last week so far after a tough couple of weeks with £-$ up nearly 2%. The latter is looking to consolidate current levels before pushing on again to the favourable 1.40 mark.
First on the calendar are unemployment figures tomorrow which is likely to continue to be a non-event until after the furlough scheme has finished. Inflation on Wednesday should see a slight uptick and any central bank speech is of interest at the moment and Governor Bailey is talking about diversity in market intelligence shortly after.
Thursday is where the real action begins with the ECB announcing its latest policy update followed by the usual press conference. US jobs data continues to be key for the $, but it's all eyes on the PMI's on Friday. Some economists believe April is too soon to see vast improvements to the UK's sectors, but i'm optimistic we will see excellent readings. The retail sales and consumer confidence data should also prove beneficial to the £ and so we should be in for a strong end to the week.
Elsewhere, HSBC are the first investment bank of note that has downgraded the £'s forecasts for this year. Their view is that the vaccination rate advantage the UK holds over the EU is diminishing fast and confidence is growing towards the Euro-Zone's economic recovery. HSBC have always been relatively bearish when it comes to the £ and so we take their view with a pinch of salt. They forecast a mid-market rate of 1.1250 by Q2 end.