Overnight the Bank of Japan kept their interest rate unchanged at negative 0.1% meaning it theoretically charges interest on savings rather than giving interest. This led to no real movement in the Japanese Yen rate versus the Pound where the Pound continues to show strength.
Here in the UK the unemployment rate has improved slightly from 4.2% to 4.1% and with an estimated 1.24 million job vacancies in the UK right now the employment market is looking robust.
This will help keep the GBP/EUR rate in a favourable position towards the top of the longer term range although a breakout is looking less likely now as traders have priced in the potential rate hike on the 3rd February.
Eyes will be firmly on the UK's inflation data out at breakfast time tomorrow. Analysts are expecting an eye watering 5.2% year on year growth. This is widely above the Bank of England's 2% target and could pave the way for the suggested rate hike.
These decent numbers are keeping the Pound relatively strong versus most of the majors such as the Dollar, Australian Dollar and the Euro.
Other than that there isn't a lot of scheduled data out today so it looks like the volatility might happen tomorrow.
As ever we look forward to keeping you in the loop and look out for our next update.
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Today’s Economic Calendar
EUR: 10:00 Economic Sentiment Data
UK: 07:00 Wednesday Inflation Data