Tiger Woods won the Masters yesterday. His first major in 11 years. The way Brexit is going, the timeframe might be similar. A summer of inevitable political discontent awaits. Joy.

Now the can has been volleyed rather than just kicked down the road Sterling should maintain a neutral to positive bias over the coming months.

Sterling/Dollar

We have settled above 1.30 the figure and there looks like strong support at this level. If you have a requirement to purchase USD from GBP consider covering off some on a SPOT basis at current levels. In addition, stagger take profit orders to the upside to take advantage of any intraday moves on any market fundamentals.

You can view the movements on the graph below –

There is a fair amount of data out from the UK and the US this week. We have the ILO Unemployment rate (3M) (Feb) released tomorrow with expectations for a print of 3.9%. We also have Average Earnings Excluding Bonus (3Mo/Yr) (Feb) released with a print of 3.4% expected. On Wednesday we have inflation data released in the form of CPI (YoY) (Mar) with expectations of a figure of 1.6% against a previous print of 1.9%. In terms of US releases, the main release this week is in the form of Retail Sales. If you have any USD/GBP exposure to cover off prior to Easter please get in touch with our trading department to discuss specific levels and rates.

Sterling/Euro

If you have a requirement to sell EUR into GBP I would look to cover off some at current levels. It gives you a price point to work from. EUR/USD has moved through 1.13 the figure so this has helped move GBP/EUR lower. The UK fundamentals, on balance, have held up pretty well in spite of two years of chaos and uncertainty. I do expect Sterling/Euro to climb higher this year although every forecast now has to be caveated by Brexit. More Brexit delay will have a negative impact on the UK. This is stating the obvious. In spite of everything, Sterling hasn’t crumbled under the pressure.

You can view the movements on Sterling/Euro on the graph below -

If you have a requirement to purchase EUR from GBP I would look at take profit orders at 1.16 the figure this week as a target level. Please contact the trading department to implement an order.

In terms of data this week that will impact the direction of the Euro it is fairly limited. We have the ZEW (sentiment) survey out of Germany and Markit PMI composite (Apr) (Preliminary) out of the Eurozone. Other than that, it will likely be commentary from EU officials and politicians that will drive Euro weakness or strength.

If you have any questions please do let me know.

Have a fantastic week

Written by Liam Alexander