Chinese data shrugged off as equity markets edge slightly lower; sterling under pressure as pressure on May mounts; central banks event sees Fed, ECB, BoJ and BoE heads join panel discussion; German GDP and inflation data get us off to an underwhelming start.
It’s been a very busy week for financial markets. The Bank of England has raised rates for the first time in a decade, Donald Trump has elected a new Fed Chair and his long awaited tax reform has been unveiled.
Sterling received another opportunity to shine on Wednesday after stronger-than-expected data from Britain’s manufacturing sector reinforced market expectations of the BoE raising UK interest rates on Thursday.
The EUR/GBP took its sweet time but has now finally reverted back to its mean around the 200-day average circa 0.8750, as we had highlighted the possibility when it was still trading around the 0.92 handle at the end of the summer.