The pound started this week in the early morning down against the dollar and euro, although it appears to be regaining some ground. Poor economic data, with services and manufacturing PMIs showing record lows, put pressure on sterling last week, while euro in turn has been buoyed by better-than-anticipated retail sales. News this Sunday that Boris Johnson had been admitted to hospital also contributed to the drop yesterday. Downing Street has emphasised that it is only a precautionary measure.
Public disagreement between EU member states over the use of proposed ‘coronabonds’ to stem the effects of the economic disruption from coronavirus have made investors wary. Tomorrow, the Eurogroup will meet again and the markets will be watching closely for any sign of a change.
The dollar is still benefitting from its position as a safe haven currency, despite non-farm payrolls suffering one of the worst drops in over a decade, at -701,000.
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