Pound sterling is currently weaker against all major currencies. The British pound is the currently the weakest against the Japanese yen and the Australian dollar. Yesterday, the pound moved lower as the US dollar gained strength. Today, the pound continues to sell off. There is no obvious catalyst for the recent move lower as there have been no significant news updates and economic data releases in the last 24 hours.
Turning to recent data, year-over-year Nationwide housing prices missed expectations. While many expected the UK housing market to rebound following two years of relatively weak performance, recent data points suggests below-average growth in house prices. In Brexit news, UK Trade Secretary Liam Fox recently claimed that he does not believe the transition period should extend beyond the end of 2020. His announcement had a limited impact on the British pound. Our short-term and medium-term outlook on the pound remains bullish.
GBP/USD is currently above 1.4040. EUR/GBP is up, with the exchange rate above 0.8750. The pound is down against the Australian dollar and down against the Canadian dollar. GBP/AUD is currently above 1.830, while GBP/CAD is above 1.8140.
This is a fairly light week for economic data from the United Kingdom. The Bank of England's Financial Policy Committee minutes suggested that the BoE considered increasing the amount of money banks must set aside to counter an increase in lending. So far, the BoE has held off on making any changes. Year-over-year Nationwide housing prices (2.1% vs. 2.6% expected) were lower than expected. GfK consumer confidence for March (-7 vs. -10 expected) was better than expected. Today is the key day, and we'll get the final-take of Q4 GDP growth, February mortgage approvals, the current account and Q4 business investment. Last week, the announcement of a Brexit transition deal sent the pound soaring.