GBP/USD, which had been steadily making sharp moves to the upside in recent days, has now broken that streak to trade lower, with a modest decrease of 0.17% from the previous day’s trading session, now down to 1.2604. If the pair is to continue moving lower, it will meet support at the 1.2460 level.
Prior to this the Pound/Dollar pair had been trading at a four week high, reaching 1.2629 Pounds against the US Dollar. These fresh highs came after it was revealed that UK Prime Minister Boris Johnson had left intensive care in hospital and was back at home. However, while this news was initially positive to investors, the revelation that he was not yet fully recovered and would not be back at work for at least another week has cast doubts on the Pound once more.
Expectations for the UK economy have also been tempered by UK Chancellor Rishi Sunak admitting that they would be facing tough times economically. The Office for Budget Responsibility, an independent branch of the government used to provide economic forecasts, has said that the UK could face up to 2 million job losses, resulting in a 35% loss in Great Britain’s GDP. However, while Sunak admitted that these figures were troubling, he was still positive that the UK economy can recover “quickly and strongly” after the crisis is over.
In the UK, deaths caused by the coronavirus have now risen to over 12,000, even as the country continues its lockdown. Looking ahead, there are still the Brexit talks scheduled between the UK negotiators and the EU. The negotiations had been halted by the coronavirus, but are now set to resume tomorrow.
Of course, the Dollar has also been weaker in recent days particularly against the European currencies. On the Dollar Index (DXY), the greenback dropped 0.35%, falling below 100 points.
US President Donald Trump has suspended funding to the World Health Organisation, citing accusations of the organisation taking China’s words during the initial outbreak of the pandemic at face value, and blaming them for the spread of the virus. So far the US has given the WHO $893 million in funding, accounting for nearly 15% of the organisation’s funds.
In last night’s livestream, we talked about GBP/USD, as well as the recent highs in Gold, which you can watch below. Join us again tonight at our usual time, 10.00 am GMT.