Published: 08/06/2022 By ECAPA quiet couple of days for Sterling with the lack of economic data, as the pound trades within the existing trading range between 1.2440 and 1.2590. This morning saw the pound fall short as the dollar strengthened pushing the pairing towards the lower region of the trading range, however as we edge closer to the US open we see the pairing settling around the 1.2520 mark echoing the EURUSD move higher as investors start to focus on tomorrows ECB meeting.
As eyes look to tomorrows aforementioned meeting, we see the single currency settle as markets begin to aggressively price in rate hikes. As things currently stand, money markets have priced in odds of 75 bps worth of rate hikes by September as compared to the 70 bps on Friday. Meanwhile, odds of a 50 bps rate hike in July is pretty much a coin flip to where we sat last week. This has seen EURUSD push its head back over the 1.07 level, after spending the majority of the morning trading around 1.0680.
As with all central bank interest rate decision meetings, its the rhetoric that follows the decision that will be key.