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Boris Johnson remains in ICU for a second night

GBP - British Pound

Pound sterling remains focused on news around the UK prime minister, Boris Johnson's stay in the intensive care unit of St Thomas' Hospital in London. He spent his second night in the unit last night, and his third night in the hospital. Downing Street has stated that his condition is "stable" and that he remains in "good spirits."

Foreign Secretary Dominic Raab, who is deputising for the prime minister, has said he was "confident" the PM would recover from this illness, describing him as a "fighter". Speaking at Tuesday's Downing Street coronavirus briefing, he said Mr. Johnson was receiving standard oxygen treatment and was breathing without any assistance, such as mechanical ventilation or non-invasive respiratory support. This gave sterling some of the confidence it was thriving for, and we hit a two day high versus the USD to 1.2366.

Downing Street also suggested the first review into whether the coronavirus lockdown could be eased would not go ahead as planned on Monday next week. This was on the back of the prime minister's situation, but also the fact that this date was set when the lockdown was first announced, and the landscape has now changed somewhat. Some media outlets are talking about a lockdown being operational for a year.

The first patients have been admitted to the NHS Nightingale Hospital in east London, a temporary facility set up at the ExCel conference centre. The admissions come two weeks after the hospital with a planned capacity of 4,000 was formally announced, although an NHS spokesperson stressed limits had not been reached at other sites in London.

GBP has been very range-bound in the last few trading sessions, and will most likely wait for an update on the prime minister's condition expected this afternoon before taking further direction to break through its current ranges.

Key Movers

The last twenty four hours have epitomised just how fickle and fragile the foreign exchange markets are at present. It was only yesterday morning, we reported that what looked like a flattening of Covid-19 infection curves in Italy and Spain and a slowing of rate of increase in new infections in the UK gave the markets hope of light at the end of the tunnel. With it came a brief rally in global stocks, strengthening of the Australian and Kiwi Dollars and a return of risk sentiment weakening in the US Dollar.

Instead, the US dollar regained its mojo overnight on Wednesday as investors moved away from riskier assets again, and returned to safe haven status as concerns around the Coronavirus situation strengthened again. These concerns were only amplified after the inspector general of the Department of Health and Human Services in the US published a study summarising interviews with 323 hospitals. The study confirmed that hospitals are desperately short of personal protective equipment, and have been unable get coronavirus test results for patients. During Donald Trump's press conference last night, he tried to defiantly deny such claims, but it was clear that he was struggling to come up with viable counter arguments. Concerns very much remain around the length of the current implemented lockdowns and the more medium term outlook for the respective economies. The US dollar remains very much on the front foot this morning as risk aversion continues to take hold and the market will be keeping a very close eye on tomorrow's labor market data from the US, which could see as much as an eye watering 5 million more people unemployed this week.

Expected Ranges

GBP/EUR: 1.1280 - 1.1390 ▲

GBP/USD: 1.2260 - 1.2365 ▼

EUR/USD: 1.0810 - 1.0920 ▼

GBP/AUD: 1.9920 - 2.0110 ▲

GBP/NZD: 2.0560 - 2.0810 ▲