GBP - British Pound
GBP/USD has dropped to its lowest level since late November as a combination of Brexit worries and dollar strength contribute to its move downwards. Adding to its plight has been the decision by the UK Government to declare the coronavirus outbreak a "serious and imminent threat" to public health. The move raises concerns over how serious the situation could get as the death toll rises above 900 and over 40k are now confirmed to have caught the virus. Despite this only four Britons are known to have been infected and the government declaration gives it sweeping powers to force people into quarantine should they be deemed a threat to public health.
Tomorrow we get the first estimate of UK growth for Q4 in 2019 with markets expecting to see that the economy ground to a halt amidst Brexit uncertainty that was only cleared up (to a certain extent) by the general election on 12th December. Anything better than expected, 0.1 or 0.2% growth for example should help recoup some of the pounds recent losses however should we see the reading slip into negative territory there will likely be some more downside to the pound. GBP/USD is currently just under 1.29 however it has held up against the euro given the ongoing woes that engulf the shared currency. GBP/EUR trades at 1.1770.
The monthly US Jobs Report showed a mixed bag of results on Friday with the headline Non-Farm Payrolls number smashing expectations showing 225k had been added to the workforce for January, far higher than the 163k predicted. This good news was tempered however by the unemployment rate unexpectedly ticking up to 3.6% and wage growth also missing expectations. There was little movement in dollar crosses in the immediate aftermath of the release however as the day drew on the dollar gained across the board. With risk appetite continuing to be hit by the coronavirus as well as ongoing trade concerns between China and the US, there are far worse places to park your cash than the greenback at present especially as its economy continues perform well, albeit at a slower pace than seen last year.
Looking ahead we have Fed Chairman, Jay Powell give two days of testimony on the health of the US economy on Tue/Wed in Washington. We also have the Reserve Bank of New Zealand's interest rate decision on Tuesday night with a hold at 1% eyed. Thursday sees inflation data from the States and Friday we see prelim German GDP for Q4 2019 with the Eurozones powerhouse expected to show anaemic 0.1% growth.
EUR/USD is down to 1.0950 with USD/JPY still failing to break above 110 with some good news re: the coronavirus outbreak likely needed to enable a push above the big number.
1.2850 - 1.30 ▼GBP/EUR:
1.1720 - 1.1850 ▼GBP/AUD:
1.9175 - 1.9330 ▼GBP/NZD:
2.010 - 2.0190 ▲GBP/CAD:
1.7090 - 1.7250 ▼