Good afternoon,

With little data out yesterday it’s clear the pound remains pressured, especially against the dollar, trading around 1.377. Sterling was already struggling due to the politics surrounding relaxing Covid-19 related restrictions on July 19th; this was due to objections from the scientific community before releasing downbeat UK monthly GDP and manufacturing data. The last thing the pound really needed was some disappointing data. Safe-haven demand for the dollar remains high and the Federal Reserve’s hawkish stance is continuing to underpin the GBPUSD price, especially given the  latest Covid resurgence and variant fears in the UK.

Early this morning The European Central Bank (ECB) Governing Council member and German central bank chief Jens Weidmann commented, “we are not aiming for inflation either above or below 2% target; that is important to me.”

Today, we have the Bank of England Governor Andrew Bailey and European Central Bank President Christine Lagarde participating in a panel discussion titled “Digitalisation, intangibles and potential growth in a post-COVID world” at the Global Forum on Productivity, in Venice.

Have a great weekend.

William Jones, Senior Relationship Manager.

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