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Sterling gains as UK political concerns eased

Monday 10 May, 2021

Daily Currency Update

GBP - British PoundThe Pound was an outperformer on foreign exchange markets this morning as investors welcomed an easing of UK political risks. The Conservative party won local elections that were previously Labour and as the SNP fell short of an outright majority, another independence referendum is unlikely as the Conservative government still rejects it. All eyes now lead to the UK GDP report on Wednesday, as it remains to be seen whether the update will impact the British Pound as two consecutive quarters of negative growth signals a technical recession and could lead to sterling weakness.

Key Movers

US Jobs report rocked the currency market Friday, missing expectations by a huge margin, sending the USD lower against a range of currencies. US Nonfarm payroll employment registered a disappointing 266k gain in April against a forecasted 978k.The Federal Reserve is in no rush to taper bond buying nor raise rates until they see more evidence of labor market progress, which could contribute more towards the recent USD decline.

Expected Ranges

  • GBP/USD: 1.4075 - 1.4145 ▲
  • GBP/EUR: 1.1545 - 1.1615 ▼
  • EUR/USD: 1.2145 - 1.2195 ▲
  • GBP/AUD: 1.7865 - 1.7965 ▲