The calm continues for sterling, as the weekend papers continued to dwell on Labour’s failings in the calm before the Makerfield by-election, and with the fragile ceasefire still holding in the Persian Gulf.

Over the past month, although there were some fairly sharp movements, GBP/EUR has ended up around a third of a cent down and GBP/USD close to 1% down. Considering the political upheaval that remains unresolved, anyone relying on a strong pound might be considered to have dodged a bullet.

If concerned that your luck may not hold, do call your account manager and discuss locking in your rate with a forward contract.

The week starts with the oil price at its best since the start of the conflict, below $85. This could turn at any time if the missiles restart, and it’s also worth remembering that it barely rose above $100 in the aftermath of the Ukraine war starting five years ago, but we still ended up with 11% general inflation.

For now, however, the latest inflation readings for Europe which came out on Friday showed levels considerably above the 2% target (annual inflation in Spain and Italy is above 3%), but not accelerating. Indeed, German prices fell last month by 0.2%. The European Central Bank (ECB) will be looking for more data as it ponders its next interest rate decision next week.

Against that backdrop the US dollar has been weakening, helped perhaps by the replacement of Jerome Powell as chair at the US Federal Reserve. However, Powell will be staying on the Fed’s board of governors and this could help to stabilise the markets.

In the UK we are in a quiet period for data, but we have just had the Nationwide House Price index. The recent pattern has been for annual house price rises to be tracking more or less in line with general inflation, at around 3% per year. However, there was a change in direction this morning, with 0.6% decline in May, according to the Nationwide. We’ll get the Halifax reading at the end of the week.