Sterling continued its demise yesterday as Brexit fears weigh on the Pound, leading to GBP/USD falling to fresh lows again this week and continuing the seven year lows. Investors continue to sell the Pound as the uncertainty of the EU referendum in June this year bears down. Take note that when sentiment is overwhelmingly one-way on a currency, risk of a reversal will build substantially. The CBI Realized Sales figure was posted lower than expected yesterday for February. This was rather downbeat on the retail front as this insight ultimately proves a slowdown in consumer spending is appearing.
From the US, the services PMI figure fell below forecasts to 49.8, falling into contraction territory and adding to further week data seen this year from the States. However, many have commented that the downturn is due to the poor weather seen in January, and that this reading is going to be short lived and bounce back into expansion in February.
Yet again, today’s markets focus will be on the UK in the morning, as the secondary reading of Q4 GDP is posted. With expectations for UK growth to remain at 0.5%. Eurozone inflation comes into the picture again for the single currency zone as the y/y CPI figure is released at 10am. The ECB are ready to pull the trigger on further QE stimulus if inflation for the Eurozone continues to drag, therefore this figure will be heavily scrutinized once released. From the US later, we have the Durable Goods orders m/m figure due to hit the wires later this afternoon.