Sterling was strong against both the euro and the dollar at the end of last week, going against its recent trend of dropping as the markets fall. However, the pound is slightly weaker this morning after UK’s sovereign debt was downgraded one notch from AA to AA- by Fitch Ratings on Friday, owing to the significant increase in fiscal spending announced by the government.
On Friday, Boris Johnson announced that he has tested positive for coronavirus, causing the pound to weaken briefly. The Health Secretary, Matt Hancock, also has the virus.
It’s thought that, despite recent strength, the pound will remain vulnerable to coronavirus news. It also may be impacted by any news that the crisis is impacting the progress of Brexit negotiations.
This week, they’ll be data releases that could reveal more about how the virus is affecting the UK economy. Consumer confidence figures for March are due today and Manufacturing PMI on Wednesday.
