GBP review

Sterling caught somewhat of a break on Tuesday after area inflation kept from falling below zero, holding flat in March for the second time in as many months. Had the key report that the Bank of England monitors closely to shape its policy outlook tipped below zero, it would've raised the risk of deflation taking hold, a scenario that could choke off growth by enticing consumers to delay spending in the hope of paying lower prices down the line. 

Sterling hit a five-year low Monday and remains at risk of falling further should expectations remain low for a decisive election outcome early next month. The pound caught a break late Monday after a political poll showed the ruling Conservative Party with a narrow lead ahead of the May 7 vote. Watch those polls which are likely to serve as a wild card driver for sterling and keep volatility on the high side.