Last week was relatively steady for Sterling exchange rates, with the Bank of England’s latest meeting delivering no surprises. As widely expected, the BoE kept rates unchanged at 4.50%, reflecting caution due to inflationary pressures that are expected to intensify through spring and summer.
Upcoming increases in National Insurance, which will raise employer labour costs, and a rise in stamp duty are both anticipated to add further upward pressure to inflation, suggesting the Bank won’t be rushing to ease policy anytime soon.
This week promises more volatility, starting on Monday with Flash PMI data from Europe, the UK, and the U.S. Although these figures are preliminary, they provide a useful snapshot of economic health heading into April. Both UK and EU PMIs are expected to remain relatively robust, while the U.S. numbers might show slight weakness.
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