European inflation and production data released today was generally neutral, CPI coming in exactly as analysts expected at 0.4% for March.
The Euro gained a little strength against the Pound, trading just above the 1.13 level.
This month has been positive for the currency pair, the Pound gaining around 4% in value against the single currency since April 1st. The movement has mostly been due to a welcome break in negative UK data, allowing markets to price some value back in to the ailing UK currency.
Simon Eastman, senior broker at Currency Index, said “the story of 2009 so far has been of the pound being held back every time negative figures come out of the UK – whether that’s house prices, inflation data, or GDP. The break in bad news has allowed some strength to return.”
For anyone needing to send Euros abroad, whether it’s transferring money to a French notaire for a property purchase or sending Euros to Germany to import goods, the movement is welcome. The Pound dropped over 25% against the Euro throughout 2008.
The next key data to look out for is on Tuesday morning – when a raft of UK figures are released including unemployment figures and the Bank of England minutes. Of course, the Government’s budget next week is also likely to have an effect on markets.
