GBP review

Western Union:

Sterling had been buoyed this week by M&A news related to Shell's deal to buy U.K. rival BG Group for $70 billion. But Britain's biggest trade deficit in seven months had the pound back under pressure as it underscored the vulnerable shape of the U.K. economy. 

As expected, the Bank of England held its key rate unchanged at a record low of 0.50%. The minutes of this week's meeting are due on April 22 and should shed more light on the road ahead for U.K. monetary policy. 

The next critical event on Britain's radar is the April 14 release of highly important inflation data that's at risk of falling below zero. A subzero print, coupled with election uncertainty, would run the risk of dropping sterling to fresh multiyear lows.