Wednesday 28th October 2020
IFX market report
On Tuesday we saw the Pound gain ground on both the EUR and U.S. Dollar. Tuesday marked a week until the highly anticipated U.S. election between former Vice-President Joe Biden and current President Donald Trump on November 3rd. Uncertainty surrounding the outcome, coupled with persisting worries about a second U.S. COVID-19 wave is causing the greenback to weaken.
Another positive session of the Cable on Tuesday as markets saw the pair rocket into the high 1.30’s. The pair opened modestly at 1.3006 and with considerable upside moves throughout the day, finally closed at 1.3074.
On the Brexit front, latest reports have indicated that there will be delays with the new essential post-Brexit freight software, due to launch 1st January. The delay would surely cause serious disruption to the UKs biggest trade routes. The Association of Freight Software Suppliers (AFSS) said its members could not guarantee delivery because officials had failed to give it details and direction for the project. In response HMRC said it was "continuing to engage extensively with the software developer community and community system providers to ensure that they have everything they need to develop their products".
GBPEUR also managed to make some gains on Tuesday. The pair opened the day at 1.1020, and with rising COVID-19 on mainland Europe weighing heavy on the EUR, a stronger Pound capitalized and the pair closed the session off at 1.1051.
Across the pond, the recent polls give Democrat candidate Joe Biden a considerable lead over Donald Trump in the upcoming election – reports show him gaining momentum against the President in the usually much disputed ‘battleground states’. Also referred to as the swing states (meaning that reasonably either Democrat or Republican can win), all but one are in Bidens favour. Florida, Pennsylvania, and Ohio are the three states with the highest number of electoral votes for the swing states – Biden leads Florida and Pennsylvania, while Trump claims Ohio.
With COVID-19 cases on the up in both the U.S. and Europe, EURUSD started Tuesday clinging to 1.18, opening at 1.1803. As the day progressed the pair managed to gain some upside and closed the day at 1.1829.