The Pound
The GBP/EUR pair has maintained a stable position, hovering within the 1.14-1.15 range over the past few weeks.
GBP/USD exchange rate however has been a little more volatile with 1.25 level being hit last week following the negative US data.
Former Prime Minister, David Cameron is making a comeback to government, taking on the position of Foreign Secretary.
This reshuffle has sparked speculation about the possibility of an early general election next year. Political shifts can significantly influence currency movements, and we'll be closely monitoring the pound's performance throughout the week.
Upcoming Events
This week is all about Wednesday's budget and what the Chancellor can do to build on the positive inflation figures and combat slow growth.
While the current consensus points to the Bank of England initiating interest rate cuts towards the end of next year, a sharper decline in inflation might prompt a reassessment of these forecasts by the markets.
A reduction in inflation could be viewed positively for the GBP, potentially aiding economic recovery as the burden of the cost-of-living crisis eases.
Our Thoughts
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