Good morning,
Yesterday saw the GBP continuing its recovery against the EUR and USD, pushing back to 1.1695 against the euro and 1.3765 vs the dollar as risk sentiment improves globally.
The EUR is also fighting back against the dollar. Since the start of the month, EURUSD has dropped almost 2%, however, it is starting to find its feet, and with four strong days of trading behind us, the rate has risen to 1.1771, cutting that drop close to 1%.
The dollar has been pressured by the rising Covid cases throughout the US. There has long been speculation on when the Fed will be tapering their quantitative easing programme as cases were dropping and the economy seemed to be returning to some sort of normality, though the recent rise in positive cases has caused investors to question the likelihood of this. Yesterday, US Durable goods data was released, the forecast was low at -0.8%, the reading was better than estimates however, at -0.1% which surprised the market and will be taken into consideration by the Fed on Friday at the Jackson Hole Symposium.
Today marks a quieter day for data releases, though we will see Preliminary US GDP figures released at 13:30, which will again be eyed by the Fed as we look towards Friday’s speech from Fed Chair Jerome Powell.
Have a great day.
Thomas De Caluwé, Relationship Manager.
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