The Pound has recovered all of its recent losses against the Euro and the Dollar. On Thursday, the Bank of England interest rate decision and policy statement will be released at midday. Following on from Governor Bailey’s recent positive comments, the market Is expecting more positive and upbeat comments about the UK economy.
Yesterday morning, the Euro initially made some gains after Eurozone and German ZEW economic sentiment figures came out better than expected. Italy has reimposed lockdown restrictions whilst France is reported to potentially shutdown Paris. The Euro generally remains quite weak as a result of the slow vaccine rollout on the continent.
This evening, the Federal Reserve interest rate decision and press conference will take place. It is expected that the central bank will upgrade its growth forecasts which is likely to increase expectations that a higher interest rate could be seen as early as late 2022. Overall, the Dollar has lost some ground across the board.