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Pound experiences another solid day
It was another solid day for the pound yesterday off the back of Theresa May’s speech earlier in the week and the European Central Bank’s decision to keep their monetary policy unchanged.
The pound hit a two-week high against the euro, in what could be a sign of what’s to come in 2017, given the Prime Minister’s bullish comments on Tuesday, and Mr Draghi’s dovish tone in Frankfurt yesterday.
For the US dollar, it was a mixed bag on Thursday and mostly underpinned, after another set of firm US data, before a late selloff that saw it head back towards its opening levels.
European Central Bank keeps monetary policy unchanged
The European Central Bank has kept its monetary policy unchanged, leaving the refinancing rate at 0.00% and the deposit rate at -0.4%, as was widely expected. It was acknowledged that the Eurozone economy was stronger, however still very fragile, thus the European Central Bank cannot afford to relax.
Draghi furthermore added that the stimulus programme had to continue, and potentially even be increased if it is within the best interests of the EU long term. Investors will be keeping a keen eye on the movements of the European Central Bank in the coming months, especially with potential political unrest within three of the EU’s major players later in the year.
Data to come
Today should be much of the same, with fairly thin data out within the Eurozone. UK sales for the month are out at 10.30am, meaning all attention will be on Mr Trump later in the day as his inauguration takes place.
