Yesterday, the pound strengthened further against the euro and US dollar reaching a high of 1.1518 and 1.2631 respectively on the interbank exchange rate. The pound was supported as investor confidence returned to the pound and the continued positive investor sentiment could help see the pound make further gains and surpass the highs seen in February earlier this year.
While the pound has seen a reprieve, it is worth remembering that it was just over 2 weeks ago the pound was at its worst levels, and with all the uncertainty that still prevails it could still push the pound one way or the other.
The Guardian reported the UK missed three opportunities to join a European Union scheme to bulk buy personal protective equipment. If the UK had joined the scheme it could have provided much needed equipment to protect the UK, and helped to reduce the lockdown period which is currently estimated to be in place until the 7th May, according to the Times. The Chancellor of the Exchequer Rishi Sunak, said there was the possibility that the UK could see a 25% to 30% fall in economic growth during the second quarter of this year.
Today the global number of confirmed Coronavirus cases topped 2 million. While Italy and Spain start to see their lockdown ease with essential workers returning back to work, France has extended their lockdown until the 11th May as President Macron confessed that they were not properly prepared to combat the pandemic.
The International Monetary Fund reported the global economy could contract by 3% which would be the biggest downturn since the 1930’s great depression reporting ‘It is very likely that this year the global economy will experience its worst recession since the Great Depression, surpassing that seen during the global financial crisis a decade ago.”.
European Commission Vice President Valdis Dombrovskis, yesterday said the European Union would create a €1.5 trillion economic recovery fund following the Coronavirus pandemic but how this is to be funded is yet to be decided. EU leaders will hold a video conference on the 23rd April "to lay the ground for a robust economic recovery," European Council President Charles Michel said last week.
This week will see the latest round of earnings figures from some of the world’s biggest companies which will show just how badly the Coronavirus pandemic has started to affect them. While most headlines will focus on the quarter-on-quarter falls in earnings and profits, the market will be more interested in signs when these companies might recover. This in turn will determine how long and how much the pandemic will cost the US economy.
While the US government has supported their economy and businesses with a large fiscal stimulus, the results of these announcements could well change the sentiment of the US economy and point to further recessionary pressures. US President Donald Trump wants to get businesses back to trading as soon as there are any signs that the Coronavirus is starting to plateaux. His initial indication to have the US back to normal by Easter, may have been a little too optimistic.
Yesterday, US export and import price indexes month on month for March came in better than expected at -1.6% versus a forecast -1.9% and -2.3% against a forecast -3.2% respectively. Tomorrow the market will be closely watching data releases at 1:30pm UK time, with US retail sales figures for the month of March currently forecast at -8.0% against a previous reading of -0.5%.
The best in the business. I use FCD frequently and have absolutely no hesitation in recommending them to others. Pricing is immensely keen and front and back offices are highly efficient. Great all round service.
Good prices, efficient and friendly service – what more could one ask for.
Quick and efficient way of moving our money. Don’t have to worry about the money not being in our bank the following day. Having been using you for 10 years now.
I have absolutely no complaints about the services I have received from you. Every time I have used your services I have received complete satisfaction in every way. Excellent all the time.