Dollar generally firmer

The dollar is firmer against most of the other main currencies. It has recovered further ground against the euro trading just below $1.2250, which is around 3 cents off its recent lows, and has risen to under $1.39 against sterling, which compares to its low of almost $1.43 late last week. It had been one-way traffic for the US currency since the start of 2018, so perhaps a pullback was inevitable at some stage

Sterling is trading at just over 88p against the euro ahead of today’s Bank of England monetary policy announcement. It is widely expected to leave interest rates unchanged at 0.5%, but it may strike a more optimistic note on the growth outlook in the UK and thus keep the door open to another rate increase relatively soon

European equity markets bounced yesterday following Tuesday’s falls,  though US stocks, while opening stronger, subsequently sold off to end marginal lower on the day. As noted yesterday, we’re probably not out of the woods just yet as far as stocks are concerned

Almost six months after elections, Germany finally has a government with the CDU and SPD coming together in a ‘grand coalition’

Fed member Evans says ‘the risks seem to be moving toward the likelihood of more inflation’, while his colleague Williams says 3 to 4 rate interest rate hikes this year seems appropriate

Data due today includes jobless claims in the UK