The pound was little touched by some softer-than expected growth data last week. However, GBP’s sensitivity to domestic data drivers may increase, even more so as this week’s calendar includes higher-frequency data, according to economists at ING.
Focus shifts back on data
“We suspect that jobs figures on Tuesday will be a more important release compared to CPI numbers on Wednesday, as a bounce higher in August inflation will be mostly due to base effect and short-term CPI swings are playing a secondary role in driving BoE’s decisions compared to longer-term projections.”
“Later in the week, retail sales will also be in focus.”
“We think the data flow should prove by-and-large supportive for the pound and we could see EUR/GBP press lower towards the 0.8500 mark while GBP/USD may break above 1.3900.”
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