OUR SUMMARY
This week, key data will put the UK and GBP under the spotlight, with job figures on Tuesday and PMI data on Friday. Wage growth will give a glimpse into inflationary pressures, while the unemployment rate and PMI numbers will offer a clearer picture of the economy’s performance.
Concerns over the UK economy have been rising in recent weeks, with markets now anticipating the possibility of three rate cuts from the Bank of England this year. This expectation is driven not only by the slowdown in inflation but also by broader economic uncertainties, as highlighted by BoE member Taylor last week. Disappointing job and PMI data could lead to further weakness in GBP.
On Friday, EU and US PMI data will also be released, helping to assess economic conditions for January.
At the same time, markets will be closely watching President Trump’s early actions in his presidency. Financial markets are prepared for a flurry of executive orders, potentially covering immigration and trade tariffs, which could lead to
significant volatility in the USD.
