Wednesday’s gains for Sterling across a broad range of currencies reversed sharply when BoE governor Bailey insisted any inflation increase will be temporary, warning policy makers against overreacting to any jump. This put to bed comments made by departing BoE chief economist Andy Haldane on Wednesday, having said inflation could hit 4% this year, June manufacturing PMI’s also undershot estimates (63.9, expected 64.2). As a result, Sterling hit a three-month low against the US Dollar also closing at the lower end of the weeks range against the Euro.

Dollar buying interest extended ahead of today’s all important non-farm payroll data for May at 1.30pm. The IMF also upgraded growth for the US economy, concluding interest rates would need to start rising in 2022. All told, the Dollar has broken through some significant technical levels across the board this week. US factory orders for June are also released at 3.00pm.

The Euro also hit a three-month low against the Dollar, having traded in Asia either side of this major support of 1.1850, a weekly close below here is likely to attract broad based Dollar buying again. April Eurozone producer prices are released at 10am this morning.