Daily Currency Update

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Trump's push for election delay rejected

GBP - British Pound

The pound found itself rallying all week against the US Dollar, as it breaks the 1.31 handle for the first time since March’s ‘Black Tuesday’. Much of the pairs surge is attributed to the civil unrest, lack of stimulus and what seems an uncontrollable COVID-19 situation in certain states in the US. Chances are, we will start to see a pick-up in the hospitality sector, as Johnson ‘Eat Out’ scheme goes live on Monday. There will be a lag in seeing these results in the data however it will do GBP no harm in the short term either.

There is also talk that Johnson is re-applying harsh lockdown measures within the micro-lockdown areas in the country, including banning garden visits. This will certainly put investors mind at ease, as Johnson is shown to be taking the virus seriously, even in the face of an abundance of criticism over his handling of the virus.

Key Movers

There was a mixed bag of data out for the US and Eurozone yesterday. Germany joined other European nations yesterday that recorded huge plunges in economic output last quarter. Their GDP came in 1% worse than expected at -10%, which was the largest decline since the beginning of quarterly GDP calculations for Germany in 1970.

The US actually saw better-than-expected data, however nothing to write home about as the figure came in at a tear-jerking -32.9%. It feels as though Trump is beginning to worry about his re-election plans and has encouraged a delay in the November 3rd election, which was rejected by both Republicans and Democrats in congress. Trump must put a lid on the current unrest and will hope the Fed have some ideas around an increase in short term stimulus, as an exit plan for the less-affected states. This afternoon we see Canadian monthly GDP figures released.

Expected Ranges

GBP/USD: 1.3010-1.3180 ▲

GBP/EUR: 1.0975-1.12 ▲

GBP/AUD: 1.8210-1.84 ▲

GBP/CAD: 1.7520-1.7710 ▲