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US GDP & inflation report dominate the week ahead

The US/USD leads a rather dull ending to an exciting March..

There are not many data-houses willing to offer a short-term forecast on the Pound right now after last week's BoE event. Our best guess is 1% above current ranges and 2% below, a more to lose than gain scenario. This is because GBP remains in the upper trading limits versus most currencies, but UK interest rates look close to be being cut and this will be Sterling negative. 

March has been a month of two halves for £ with the first being very productive and the second a disappointment. The Pound looks set to close the month in similar fashion to how it started though, so it can be looked at a 'chance missed' for those that didn't pull the trigger 2-weeks ago. 

There is nothing coming out of the UK this week, so movement will come from events elsewhere, as-well-as the usual volatility through the opening and closing of trader positions..

The Euro gained on the Pound, but lost ground to the Dollar last time out after playing the sitting duck role. Similar to the UK, the EU has nothing of value to offer markets this week and so volatility will arrive through events outside of its control..

The week is dominated by the US this week and it could be yet another strong week for its currency. Tuesday, Thursday & Friday offer something to investors and traders alike. The latter arrives whilst most markets are closed for the Easter holidays and so liquidity will be low, which means we may see a surge in volatility next Tuesday. 

The evidence has been consistently showing that the US economy remains resilient and its labour market tight whilst interest rates are high. It feels like the Fed is less unanimous on the need for aggressive easing and so we may even see the US cut rates after the EU & UK, which would send the USD through the roof..