The pound is mixed this morning, gaining against the broadly weaker euro, but consolidating against the dollar after Rightmove said the UK House prices decreased in January. Britain's home sellers cut asking prices for a third month in January, pushing the average asking price by 0.8% from December to 224,060 pounds. Sterling however, gained more than 1% against the euro after Standard & Poor’s rating agency downgraded nine European nations. There are no economic releases or policy speeches scheduled for today. Looking to the week ahead, inflation report and labour market data headline the economic calendar. On Tuesday ONS publishes consumer price inflation data for December, with the expectation for the inflation to have fallen to 4.2% after reaching 4.8% in previous reading. On Wednesday, we receive unemployment data, and the market consensus is calling for the ILO unemployment rate for November to have remained unchanged at 8.3% , and the December’s claimant count to have increased by 7.0K. Finally, retail sales data for December are published on Friday, with projections for figures to have reported growth of 0.6%.
The euro slumped across the board during the weekend after S&P rating agency downgraded top grades of France and Austria by one notch to AA+, while affirming the top ratings of Germany and Netherlands. The agency also downgraded Italy, Portugal, Spain and three other Eurozone member states. The larger euro downward trend was avoided after the European Central Bank announced it will purchase Italian and Spanish debt in order to calm the markets. Separately, traders are turning their attention to Greece this week as Greek government and its crediting partners are seeking a way to reach agreement as country is facing danger of sovereign default.
The dollar gained across the board during Asian session as debt crisis in Eurozone pushed investors into safety of the US currency. The global stock markets consolidates as fears intensified that everything isn’t right in the Eurozone. Looking to the week ahead, Empire Manufacturing, Industrial Production figures and December inflation report headline the economic calendar in the US. Expect for the greenback to trade in tight ranges today, as US is closed for the Martin Luther King Jr. public holiday.
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