The pound sterling (Currency:GBP) remains under pressure as it is shown that the UK economy continues to under-perform.
This weakness has largely been expressed through the pound vs US dollar exchange rate. That said, the pound euro exchange rate has also ceased its advance, and it will take some strong economic data to kick start this trend once more.
(The latest pound euro forecasts have been published on our IMT site, access is offered free via Facebook).
Yesterday it was shown that industrial production (IP) was unchanged on the month. Manufacturing output fell strongly, as seven of the 13 sub-sectors reported declining output. The manufacturing output index fell by 0.7% m/m
"The sustained weakness in industrial and manufacturing production to date suggests that the hoped-for manufacturing-driven recovery is not imminent. In fact, the rebalancing of the economy towards export-driven manufacturing production seems increasingly unlikely in the near term at least as doubts increase over the growth prospects in the UK's main trading partners," says a morning note from Barclays on the matter.
For those keeping an eye on the forex markets heading into this weekend it would be worth noting that the pound sterling could be a winner.
"Generally we have a negative bias for the markets over the coming days, which indicates a strengthening of USD, JPY and – to some extent – GBP," says a morning forex note from Jyske Markets.
Jyske Markets have advised investors to remain on the sidelines as we approach the key event of Greek elections.