Yesterday, sterling managed to push on above the 1.30 mark on the dollar and 1.10 on the euro, as Boris Johnson gave his update on new Coronavirus restrictions, importantly reiterating that the Government doesn’t believe a full lockdown is needed. Although Sage have pointed towards a circuit-breaker mini lockdown to combat the second spike; Johnson has made it clear that balancing the needs of the economy with the health of the population is key this time around – keeping GBP supported in the near term.
Essentially, the pound will need to navigate two potential obstacles alongside the continuing coronavirus pandemic which will guide its hopes in the near term; namely, avoiding negative interest rates and achieving a positive outcome on Thursday’s EU council meeting. This morning’s unemployment rate rise seems to have gone largely under the radar, as the rise was widely expected as the first furlough scheme winds down. From here on out – it is very much the pound holding its breath for Thursday and desperately hoping no other headlines come into dispute the notion that the UK may finally be getting somewhere with its EU trade negotiations.
Have a great day.
Author: Joshua Haden-Jones, Senior Relationship Manager
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