Pound pairs might be off to a slow start this week before the economic calendar action picks up later on.
What’s lined up? Here are the potential sterling catalysts to watch out for:
Mid-tier economic reports
- Headline U.K. CPI (Jan. 20, 8:00 am GMT) likely improved from 0.3% to 0.5% in December, core CPI probably rose from 1.1% to 1.3%
- CBI industrial order expectations (Jan. 21, 12:00 pm GMT) to fall from -25 to -35 this month
- GfK consumer confidence index (Jan. 22, 1:00 am GMT) likely slipped from -26 to -30
- Retail sales (Jan. 22, 8:00 am GMT) to post 0.8% rebound in December after earlier 3.8% decline
Flash PMI readings
- Manufacturing PMI likely fell from 57.5 to 53.1 this month
- Services PMI probably dropped from 49.4 to 45.4
- Readings below 50.0 reflect contraction, above 50.0 signal expansion
- Weak results expected as the U.K. imposed stricter lockdown measures late last year to curb the spread of the new strain of the COVID-19 virus
Technical snapshot
- Stochastic paints a mixed picture of pound pairs, placing GBP/CHF, GBP/NZD, and GBP/JPY in the overbought zone
- Sterling has been most volatile against the Kiwi over the last seven days, moving an average of 117 pips per day
