IFX Market Report: Tuesday 23rd June 2020

Sterling was largely flat yesterday, only making small gains versus a softer US dollar.

UK industrial output posted its largest quarterly fall on record during the three months to June, but this had little impact.

In Brexit news, both sides have agreed that some progress has been made and with the worst economic data seemingly out of the way and with lockdowns and social distancing beginning to ease, there could be upside for the pound in the coming weeks. Bank of England Governor Andrew Bailey stated that the central bank should start to reverse its quantitative easing asset purchases before raising interest rates on a sustained basis.

Manufacturing and Services PMI data is released this morning.

GBPUSD opened at 1.2423, closing up at 1.2460

GBPEUR opened at 1.1070, falling to a low of 1.1042 before closing at 1.1069

The US dollar had a quiet Monday, softening slightly in response to risk appetite. Overnight reports have intimated that the proposed trade deal with China may be over, rekindling concerns that already tense relations between the US and China may now worsen, disrupting supply chains and capital flows.

Flash manufacturing data is due Stateside this afternoon.

Yesterday saw little eurozone activity and the single currency remained largely flat. A raft of positive PMI data for France, Germany and the bloc as a whole has had little impact so far today.

EURUSD opened at 1.1222 and closed at 1.1257

The Stateside whisperings that the China trade deal might not happen has caused risk-on, commodities currencies to weaken. The Australian dollar lost 0.5%, while the New Zealand dollar fell 0.65%.

Older posts
Newer posts