After a poor start to the week, the pound strengthened against both the euro and the dollar yesterday. However, the bounce was short lived, as it was caused by technical factors such as month-end flows and option expiries. The broader picture is still thought to be unsupportive for sterling.
Boris Johnson released the details of his ‘new deal’ yesterday – a plan to lift the UK economy out of the coronavirus crisis. The Prime Minister vowed to fix longstanding economic problems and promised a £5bn “new deal” to build homes and infrastructure. He also said that plans set out in the Tory election manifesto would be speeded up and “intensified,” he added. The markets were, overall, underwhelmed by the announcemnt, as it contained no surprises. However, Chancellor Rishi Sunak has said that he will provide an economic update on the 8th of July.
The first ‘local lockdown’ has been imposed in Leicester, with non-essential businesses shutting and pubs and restaurants remaining shut, despite re-opening everywhere else this weekend. This comes after the city council reported 944 positive tests in the two weeks – about one in 16 of the total UK cases during that period.
Today, Manufacturing PMI data will be released for the UK, as well as Housing Prices.
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