Markets digest Yellen testimony
Pound fell yesterday
The pound fell yesterday following lower than expected inflation data in the morning. The market was at the early stages of pricing in the possibility of a UK rate hike later this year but yesterday's data has taken the gloss off this. Today we get further feedback from the UK economy with the labour market report. Here unemployment is expected to rise slightly and average earnings are also anticipated to edge lower which could weigh on the pound.
Elsewhere we have US retail sales and CPI inflation data this afternoon. Retail sales for January are likely to show a strong start to 2017 and inflation is also expected to edge higher. We also have further testimony from Janet Yellen as she addresses the House of Financial services committee.
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