Daily Currency Update

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Sterling whipsaws in run up to Christmas

GBP - British pound

Yesterday was a chaotic day for the pound and a day which could set the tone for the rest of the year. Whilst investors digested the latest lockdown news from over the weekend and the fact that France was shutting its borders to the UK for 48 hours GBP sold off dramatically. GBPUSD lost almost 2.5% in early trading before recovering the losses as positive Brexit headlines trickled through. Eventually the pound bounced back finishing the day close to where it had started around GBPUSD 1.35 but it was tumultuous and in all the pair had swung almost 300 pips in both directions. As mentioned this really could set the tone for the next few days and into next week particularly with Brexit headlines coming back and forth.

Key Movers

Finally, after months of wrangling the US Congress finally passed the much needed $900bn funding bill as it was approved in the Senate. Whilst this didn't cause too much to happen in the markets as it was widely expected, we have seen a sell off in Asian equities and US futures overnight as fears over the new strain of COVID-19 spread. Risk sentiment has been dampened somewhat and coupled with the Brexit deadline fast approaching we could see the US Dollar bounce back from its recent 2.5 year lows.

Expected Ranges

GBP/USD: 1.3200 - 1.3500 ▲

GBP/EUR: 1.0860 - 1.1020 ▲

GBP/AUD: 1.7700 - 1.7800 ▲

EUR/USD: 1.2140 - 1.2250 ▲