The Pound declined against the Euro and made gains against the Dollar on Friday as UK business investment was revised a little higher in Q4 but was still down a steep –4.3% in the quarter and –23.5% yr, the sharpest drop in annual terms in records which stretch back to 1967.
Chancellor of the Exchequer Darling last week reported his latest economic growth forecast is “in line with the Bank of England forecast.” Darling said he plans to “reduce borrowing further” and reduced his budget deficit forecast for the next five fiscal years by £44 billion. On the whole, Darling’s fiscal report was more proactive than expected about addressing the U.K.’s fiscal problems. The U.K.’s 2009-2010 budget deficit is expected to total around £167 billion and be slightly less in the 2010-2011 fiscal year.
The Dollar declined against the Euro and the Pound on Friday as US GDP growth was revised down from 5.9% to 5.6% annualised in Q4 and US UoM consumer sentiment was revised higher in March. The modest upward revision to UoM consumer sentiment from 72.5 to 73.6 leaves the index unchanged from February.
The Euro made gains against the Pound and the Dollar on comments by ECB’s president Trichet at a late Thursday’s news conference in Europe, where he denied criticizing the inclusion of IMF finance in any rescue package and stated that he was ‘extraordinarily happy that the governments of the euro area found out a workable solution.
Data released 29th March 2010
UK 09.30 Consumer Credit (February)
UK 09.30 Mortgage Applications (February)
EU 10.00 EC Business Climate (March)
EU 10.00 EC Economic Sentiment (March)
Consumer / Industrial / Services
US 13.30 Personal Income / Consumption (February) +
Core PCE