The just released minutes of the last BoE monetary policy meeting indicated that policymakers were unanimous in supporting the current policy. The minutes also showed that more members were in favour of increasing rates in the coming months. This assumes significance especially in light of the recent comments by the BoE Governor.

Across the Atlantic, a pair of housing market reports are expected to provide further evidence that the US housing market is poised for healthy growth in the second half of this year. The Greek Parliament will today vote on a second package of measures deemed necessary to start negotiations on a new bailout package.

Pound Sterling – UK Markets

The just released minutes from the BoE rate setting committee's July meeting showed that policymakers voted unanimously to hold the benchmark interest rate at a record low of 0.5% and its quantitative-easing program unchanged, citing the risk surrounding the Greek debt crisis. The minutes indicated that a number of BoE members saw rising inflation risks. The BoE Governor Mark Carney’s recent commentary that the UK central bank’s policy rate will rise to half the historic average over the next three years, was his strongest hint yet about the timing of the central bank's next move. Recovering from its earlier session losses, the Pound is trading on a firmer footing against the majors this morning. Going forward, investors’ attention will drift towards tomorrow’s retail sales report and markets anticipate a pickup in retail spending for June since inflation has remained subdued while wage growth has improved.

Yesterday, Sterling barely moved against the US Dollar even after data showed that UK government borrowing was at its lowest level in seven years for June.

US Dollar – US Markets

The US Dollar is trading on a weaker footing against the Pound this morning. This week, investors focus will be on the US housing market releases, with both existing home sales and house prices data scheduled later today. Last week’s residential market reports including housing starts and building permits indicated that construction activity was finally showing strong signs of recovery after a severe winter. The revival in housing construction and an encouraging rise in June payrolls report have brightened the outlook for today’s housing numbers. Markets anticipate that today’s update will show a rise in sales of previously owned homes for June while house prices will continue to recover in May, thus adding to evidence that the economy is set to accelerate in the second half of this year. In addition, the weekly MBA mortgage applications data will be eyed.

The greenback was range bound against the US Dollar yesterday, amid an absence of notable macroeconomic releases in the US.

Euro – European Markets

The Euro picked up momentum against its key currency counterparts yesterday, as fears of Greek debt crisis receded and normalcy returned to the Euro zone following weeks of severe volatility. Meanwhile, the Greek parliament is scheduled to vote today on a second set of reforms. Last week, the nation’s parliament had approved measures relating to pension and tax reforms needed by its international creditors for the initial agreement. With little in terms of economic news to drive trading in the shared currency, market participants will continue to monitor key developments in the cash strapped nation for further direction. Meanwhile, the Euro has surrendered part of its gains against the Pound this morning.

A monthly update of business sentiment from Euro zone’s second largest economy marks the start to today’s economic releases in the Euro region. Data released earlier in the day showed that the business climate indicator for the goods-producing sector in France topped market expectations for July, thus adding to evidence that the French economy is recovering at the start of the third quarter.

Other Currencies – Highlights

The Japanese Yen is currently looking for direction against the US Dollar. Data released earlier in the day revealed that Japan’s industrial activity declined at a slower than estimated pace for May, following a slight pickup in activity in April. However, factory activity data had limited impact on trading in the Japanese Yen. Recently, the Japanese government in its monthly economic report lowered its assessment of industrial output for July, as automakers and electronic parts manufacturers are trying to curb production to lower their inventories of finished goods. The lackluster Japanese factory output could cast doubt on the pace of overall economic growth in the nation. Meanwhile, the BoJ Governor Haruhiko Kuroda yesterday stated that he expects inflation to accelerate considerably in the coming months and to reach the central bank’s target of 2% in the first half of 2016.

Looking ahead, investors will today eye housing data from the US, while tomorrow’s trade data in Japan will attract significant market attention.