This morning UK figure showed a larger than expected surplus on Public Sector Net Borrowing. The figures have been seen as positive for sterling as it is in line with their fiscal targets. In early trading sterling gaining over 0.5% against the euro making a difference of over €1,000 on a £200,000 transfer. The only concern is that the National Statistic mentioned that due to strong January figures Februarys may be lower than normal. So the figures in 4 weeks will give a better “real” outlook of the recovery of the UK with how much revenue it is collecting through tax’s.
The focus on the market still lies with speculation on tomorrows Bank of England minutes and the middle east turmoil effecting commodity prices. I would expect sterling to gain further this afternoon up to the event but be wary as this speculation also happened with the inflation figures last week which was wrongly placed. When the inflation figures were less positive and the markets fell back. This could happen tomorrow so todays rate, close to a 6 week high may be lost.
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