All quiet on the Central Bank front?

The roller coaster behaviour of the US Dollar eased a little yesterday and instead it was the recently stagnant euro which caught the markets attention as it finally broke out of a 15 month range. With both the MPC and the ECB both announcing their rate decisions today, we await to see how much longevity, the re awakening of the euro proves to have.

In the first of two Interest rate announcements, noon today sees the MPC make their monthly announcement. Expectation is for base rate to remain at 4.50% on the basis that inflation is on target and Q1 GBP growth is likely to be around the recent trend. In addition the March meeting voted 8 to 1 in favour of no change.

The hawkish rhetoric from lat months ECB press conference means that an additional 25 bp rate hike is on the horizon and should not be totally ruled out for this month. However, market expectation is for rates to remain unchanged.

In addition this afternoon, there is the release of the weekly US jobless claims. Market expectation is for a figure of 305,000 up slightly from last weeks 302,000.

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