GBP Weekly Forecast (Mar. 23 – 27)

Sterling took a pounding last week on the U.K. government’s slow coronavirus response. Does it have a chance to recover this time?

Flash PMI readings (Mar. 24, 10:30 am GMT)

• Reading above 50.0 indicates industry expansion, below 50.0 reflects contraction
• Manufacturing PMI expected to fall from 51.7 to 45.1 in March
• Services PMI expected to drop from 53.2 to 45.0 in March
• Weaker than expected results could mean even more GBP selling

U.K. inflation readings (Mar. 25, 10:30 am GMT)

• Headline CPI to fall from 1.8% to 1.6% in Feb
• Core CPI to dip from 1.6% to 1.5% in Feb
• Producer input prices to slip by 2.0%, output prices to stay flat
• Lower than expected figures could keep BOE easing expectations in play

BOE statement and MPC minutes (Mar. 26, 1:00 pm GMT)

• No actual changes to interest rates at 0.10% expected
• Central bank already delivered emergency cuts earlier in the month
• No expected changes to asset purchase facility as well

Technical snapshot

• Stochastic is showing a mixed picture of GBP pairs, although majority appear to be in bullish territory.

• Moving averages also suggest a mixed long-term picture, with both GBP/AUD, EUR/GBP, and GBP/NZD looking most bullish.

Missed last week’s price action? Make sure you check out the GBP Weekly Review for Mar. 16 – 20!