Sterling did very little throughout Wednesday as dire Construction PMI data, showing the sharpest decline on record, was set against Boris Johnson indicating a five-point plan to ease lockdown restrictions over the coming weeks.
Earlier today the Bank of England held UK interest rates at the all-time low of 0.1%, as expected and held off on any further stimulus measures. However, two of its nine policymakers did vote for an increase in its bond-buying programme. The news has caused the pound to trade up by 0.2% in early trading today.
BoE Governor Andrew Bailey will be speaking later this morning.
GBPUSD opened at 1.2375 and closed at 1.2360
GBPEUR opened at 1.1455 and declined marginally throughout the day, closing at 1.1432
Risk appetite is muted after the US Secretary of State, Mike Pompeo, yesterday renewed his aggression toward China, as the Trump administration continues to consider punitive actions against Beijing over its early handling of the virus outbreak.
US private payrolls data yesterday showed a record of more than 20 million jobs lost in April, based on the ADP National Employment Report, which sets the stage for tomorrow’s non-farm payrolls report. The biggest monthly decline in payrolls on record is expected.
In afternoon trading, the dollar index was up 0.2% at 99.714.
In the eurozone, data showed that business activity almost ground to a halt last month and retail sales have also suffered their largest decline on record in March, amid the ongoing crisis.
ECB President, Christine Lagarde, will be speaking this afternoon.
EURUSD opened at 1.0803 and closed at 1.0812
In other news, the Japanese Yen appears to be overtaking the dollar as the universal safe-haven currency, hovering near a seven-week high this morning versus its rival. The yen is benefiting from increased tensions between the US and China.
