GBP - British Pound
The end of the week saw PM Johnson and the opposition initiating preparations for a general election. Johnson began to tour the country in an attempt to regain some popularity off the back of a drop in Tory ratings. He faced a tough week after receiving a wave of extreme criticism from Remainers, labelling him a ‘tin pot dictator’. Despite the criticism, Johnson is continuing to stick to his Brexit plan and will not seek an extension to the arranged Brexit deadline on October 31st.
However, it is difficult to understand what is truly going on behind the scenes. Ministers on the EU side have suggested that no progress has been made on May’s final proposal, however both Johnson and Javid have contradicted this statement. It seems the last real chance to push through a new deal before the deadline will be on Oct 17, when Johnson is scheduled to attend an EU summit. Today is an extremely important day for the pound and UK politics. Lawmakers will hold a vote this afternoon on whether to hold an early general election and there are GDP and Manufacturing Production data releases from the UK too.
The Eurozone also faces a big week. With numerous data releases and the ECB meeting later in the week, traders are expecting a wide trading range for the European currency. The ECB are expected to deliver new stimulus in order to bolster the weak economies within the block. This is expected to weigh on the Euro as it highlights a lack of economic stability in the Eurozone.
Friday ended on a mixed note for the US economy as Average Hourly Earnings increased and Non-Farm Employment change came in worse than expected. The data hardly moved the USD however much like GBP at present, the currency is being dictated by political sentiment and the US-China trade war.