Good morning,
GBPUSD is now making a new break below 1.30, which has been a key talking point since the 13th January 2020, while GBPEUR is still struggling to find short term direction with price bouncing between 1.1750 and 1.1650.
The motive behind this Pound selling has gathered pace following Sajid Javid’s weekend comments on Brexit, telling businesses that there is no alignment with the EU on regulation. This is further piling pressure on a Bank of England rate cut on the 30th January and will bring into focus three key data events this week:
- 21st January UK November average weekly earnings and unemployment rate
- 21st January UK December jobless claims change and claimant count rate
- 24th January – UK January flash manufacturing, services and composite PMI
Labour data tomorrow will be in greater focus following the recent run of softer inflation data, with the markets opting for a “sell the rallies” mentality.
Moody’s also released some updated commentary this morning, maintaining that Brexit challenges will continue to erode consumer confidence – this ties into the current performance of the retail sector. They also expect housing activity to remain subdued, although we are currently seeing a resurgence in house prices.
We hope to bring some more upbeat news in our next daily economic update!
Have a great day.
Author: Alistair Huston, Private Dealing Manager
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