Pound pairs have been relatively flat over the course of yesterday’s London trading session and through the Asian hours. Sterling has been stuck between the positive data releases and the fears around how the Brexit negotiations will play out, with the starting gun fired on trade talks yesterday.
The Coronavirus outbreak is still dampening risk appetite around the globe, dominating markets and headlines of every news outlet. All of the major stock markets and oil prices are lower, with gold touching seven-year highs recently as speculators in the market move to less risky assets. This morning saw more confirmed cases within European countries who have previously reported zero cases; with the virus now spreading to Switzerland, Croatia and Austria. EU Health Commissioners have vowed to keep the borders open, however, which should give nominal support to the euro.
The knock-on effect of this is positive news for pound sellers purchasing Aussie dollars. With Australia depending heavily on the Chinese economy, it has whipped up the perfect storm for the rate to move above pre-Brexit referendum levels. As mentioned a couple of weeks ago, this is a big milestone as it is the only major pair to return to that level.
There are no notable data releases today, with the bulk of this week’s data releases coming tomorrow.
Have a great day.
Author: Jack Nicholls, Relationship Manager
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