Sterling fails to make headway against dollar

Sterling was unable to make any headway against the dollar during the European session on Monday, but it was able to strengthen against the Euro for the sixth successive session as the single currency dipped to lows around 0.8460.

 

According to data from Visa, UK consumer spending slowed to a five-month low of 0.4% in January from 2.5% in December, maintaining expectations that underlying consumer spending will slow during 2017.

 

The latest UK consumer inflation data will be watched closely on Tuesday and a lower than expected reading would dampen expectations surrounding the need for higher interest rates while any move in the headline rate to 2.0% or higher would increase speculation that the Bank of England could be pushed towards an earlier than expected tightening.

 

Sterling was able to hold above the 1.2500 level against the dollar on Tuesday with a firm underlying tone