Sterling's Roller Coaster Ride Amid Global Economic Shifts

Sterling exhibited minimal change against the euro and dollar but declined significantly versus the yen. Economic data and central bank policy meetings are drawing investor focus, with attention shifting towards monetary policy divergence. Upcoming decisions from the Federal Reserve and European Central Bank are anticipated as inflation figures emerge globally.

Sterling maintained stability against both the euro and dollar but suffered a steep fall against the yen. This movement comes as investors adjusted their focus to upcoming economic data releases and central bank policy meetings later this week.

The pound saw a rise against the dollar on Friday, influenced by U.S. President Donald Trump's indication of a softer stance on tariffs. Despite this, concerns around the U.S. trade policy reemerged on Monday when the U.S. and Colombia avoided a trade conflict. Analysts anticipate a shift in focus towards monetary policy divergence ahead of major central bank meetings.

Both the Federal Reserve and European Central Bank are poised to announce their rate decisions on Wednesday and Thursday, respectively. Analysts suggest that while the Fed may hold steady, the ECB might cut by 25 basis points. Meanwhile, Bank of Japan's Governor Kazuo Ueda suggested more interest rate hikes, diverging from global trends, as inflation figures are set to release globally.

(With inputs from agencies.)