The GBP/USD rate continued to fall yesterday from the mid-1.28s to a low of 1.2700, a drop of nearly 1.15%. Sterling has been struggling since the huge dip in retail sales data and a lower risk sentiment, strengthening the dollar. The EUR/USD has also been impacted by the risk sentiment, setting the lowest rate in over 2 years at 1.0685 at time of writing.
Following on from the poor UK retail sales on Friday, the CBI (Confederation of British Industry) Industrial Trends Survey dropped to the lowest level since 2020, highlighting the drop-in demand and squeeze of inflation. The USD is also benefiting from its safe-haven status as the Coronavirus situation deteriorates in China with mass testing introduced in Beijing due to increasing levels of cases. The conflict in Ukraine continues to dampen market mood as well.
Today is light on the data front, with American durable goods released at 13:30 and new homes sales and the consumer confidence index released at 15:00. Investors will be looking to the headlines for further impetus.
Have a great day.
Thomas Read, Senior Relationship Manager.
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