News

Sterling Holds Above $1.23
The British pound hovered above $1.23 on Friday and is on course to post a second weekly gain, boosted by falling demand for the US dollar on general optimism about an economic recovery. However, the currency has been pressured on Brexit anxiety, the prospect of negative interest rates and calls for the resignation of the senior adviser Dominic Cummings. British Prime Minister Boris Johnson is set to resume Brexit talks next month in Brussels.
Published on 2020-05-29

Sterling Rises Above $1.23
The British pound rose above $1.23 on Thursday, after a weaker dollar more than offset renewed concerns about Brexit talks after Michael Gove said that the UK and the EU have a different political position, and that he hopes they can break that impasse. Meantime, Brexit talks are expected to resume next month and Prime Minister Boris Johnson's Cabinet insists it will not be extending the Brexit transition deadline beyond December. In addition, the prospect of negative interest rates in Britain continued to weigh even after Bank of England Chief Economist Andy Haldane said the central bank was not yet remotely close to any decision to take rates below zero. Against the Euro, the sterling was little changed at 89.75 pence.
Published on 2020-05-28

Sterling Hovers Below $1.23 on Brexit Anxiety
The British pound remained below $1.23 on Thursday, on renewed concerns about Brexit talks after Michael Gove said that the UK and the EU have a different political position, and that he hopes they can break that impasse. Meantime, Brexit talks are expected to resume next month and Prime Minister Boris Johnson's Cabinet insists it will not be extending the Brexit transition deadline beyond December. In addition, the prospect of negative interest rates in Britain continued to weigh even after Bank of England Chief Economist Andy Haldane said the central bank was not yet remotely close to any decision to take rates below zero.
Published on 2020-05-28

Sterling Depreciates from 2-Week Highs
The British pound weakened 0.9% to $1.22 on Wednesday as the threat of US sanctions against China over the Hong Kong national security law sent investors rushing for safety. In addition, the prospect of negative interest rates in Britain continued to weigh even after Bank of England Chief Economist Andy Haldane said the central bank was not yet remotely close to any decision to take rates below zero. On Tuesday, sterling hit a two-week high against the dollar after Prime Minister Boris Johnson set out plans to reopen non-essential retailers over the coming weeks.
Published on 2020-05-27

Sterling Hits 2-Week High as UK Retailers Set to Reopen
The British pound crossed $1.23 for the first time since May 13th on Tuesday, up more than 1% from the previous session's close, after Prime Minister Boris Johnson set out plans to reopen high street shops, department stores and shopping centres over the coming weeks. At the same time, demand for riskier currencies was boosted by optimism about the easing of coronavirus-related lockdowns.
Published on 2020-05-26

Sterling Hovers Around $1.22
The British pound traded at $1.218 in thin trading on Monday after the UK Treasury said on Sunday it may step in to support crucial businesses on a 'last resort' basis if a viable company exhausts all options and its failure disproportionately harms the economy. In addition, political uncertainty grew as British Prime Minister Boris Johnson was under pressure to fire senior adviser Dominic Cummings following reports that he traveled during a nationwide lockdown in March when his wife was ill with COVID-19 symptoms. Investors also worried about growing tensions between the US and China over Beijing's plan to impose a national security legislation on Hong Kong.
Published on 2020-05-25

Sterling Depreciates Further on Friday
The British pound depreciated for a third day on Friday to below $1.22, as investors assess the impact of the coronavirus toll on the economy after recent data showed retail sales slumped at a record 18% during April and the British government posted a record budget deficit. At the same time, US-China trade tensions mounted, sending investors turning to the dollar. The currency has been under pressure as investors expect an interest rate cut below zero by the Bank of England later this year.
Published on 2020-05-22

Sterling Little-Changed on PMI Data, US-China Tensions
The British pound hovered around $1.22 on Thursday after PMI data for May came in slightly better than forecast, but still pointed to the second-fastest fall in activity since records began in 1998. At the same time, US-China trade tensions mounted, sending investors turning to the dollar. The currency has been under pressure as investors expect an interest rate cut below zero by the Bank of England later this year. On the economic data front, Britain's consumer price inflation dropped to 0.8% in April, its lowest since August 2016, as lockdowns to contain the pandemic hit energy and fuel prices.
Published on 2020-05-21

Sterling Rebounds in Afternoon Trading
The British pound reversed early losses to trade at $1.228 on Wednesday, before falling back to $1.223, as demand for the dollar declined ahead of the publication of FOMC minutes later in the day. The currency remained under pressure as investors expect an interest rate cut below zero by the Bank of England later this year. Data showed on Wednesday that Britain's consumer price inflation dropped to 0.8% in April, its lowest since August 2016, as lockdowns to contain the pandemic hit energy and fuel prices. Meanwhile, the UK government announced on Tuesday a new tariff regime to replace the European Union's Common External Tariff from January 2021.
Published on 2020-05-20

Sterling Depreciates on Negative Interest Rates Hopes
The British pound weakened 0.2% to trade at $1.2236 on Wednesday amid growing expectations that the Bank of England might slash interest rates below zero, after data showed consumer price inflation dropped to 0.8% in April, its lowest since August 2016, as lockdowns to contain the pandemic hit energy and fuel prices. On Tuesday, sterling rebounded from two-month lows after the UK government announced a new tariff regime to replace the European Union's Common External Tariff from January 2021. Under the new regime, Britain will maintain tariffs on a number of products backing UK industries such as agriculture, automotive and fishing, but will cut levies on £30 billion worth of supply chain imports.
Published on 2020-05-20

Sterling Appreciates as UK Announces New Tariff Regime
The British pound rose above $1.22 on Tuesday, recovering from two-month lows hit the day before, after the UK government announced a new tariff regime, known as UK Global Tariff (UKGT), to replace the European Union's Common External Tariff from January 2021. Under the new regime, Britain will maintain tariffs on a number of products backing UK industries such as agriculture, automotive and fishing, but will cut levies on £30 billion worth of supply chain imports. The gains came in despite growing expectations that the Bank of England might slash interest rates below zero from the end of 2020, aiming to support the economy severely hit by the coronavirus pandemic. Meanwhile, data showed the number of people claiming unemployment benefits in Britain rose by the most on record to the highest level since 1996 in April, while first-quarter labour productivity posted the biggest quarter-on-quarter decline in 46 years.
Published on 2020-05-19

Sterling Recovers from 2-Month Lows
The British pound jumped to as high as $1.22 in afternoon trading on Monday, as global market sentiment was boosted by positive results from an experimental coronavirus vaccine from Moderna. Sterling touched its lowest level since March 26th earlier in the session after Bank of England's chief economist Andy Haldane said over the weekend that the central bank was looking more urgently at options such as negative interest rates and buying riskier assets to support the economy severely hit by the coronavirus crisis. Growing tensions between the UK and the EU over a post-Brexit trade deal following a third round of negotiations last week also weighed.
Published on 2020-05-18

Sterling Hits 2-Month Low on Possible Negative Rates
The British pound touched $1.208 on Monday, its lowest level since March 26th, before erasing some losses to trade above $1.210. Bank of England's chief economist Andy Haldane told the Telegraph newspaper over the weekend that the central bank is looking more urgently at options such as negative interest rates and buying riskier assets to support the economy severely hit by the coronavirus crisis. Sterling was already under pressure after Britain and the European Union clashed over a post-Brexit trade deal following a third round of negotiations last week.
Published on 2020-05-18

Sterling Depreciates to 7-Week Low on UK-EU Tensions
The British pound extended losses to hit $1.2102 on Friday, its weakest level since March 26th, after the EU's Brexit negotiator Michel Barnier said that the third EU-UK negotiating round was "disappointing" and that the EU would not bargain away its values for the benefit of the British economy. Earlier, Prime Minister Boris Johnson's Cabinet reiterated it would not be extending the Brexit transition deadline beyond December, and warned that Britain would not give up its rights as an independent state in the negotiations. UK chief negotiator David Frost told ministers the country was not asking for "anything special, bespoke or unique" in the talks, just a free-trade agreement as the EU has with other countries like Canada. The currency was already under pressure on worries over a prolonged recession due to the outbreak, a second wave of coronavirus infections and tensions between the US and China.
Published on 2020-05-15

Sterling Hits 5-Week Low on Brexit Talks
The British pound weakened 0.3% to $1.2202, after touching a five-week low of $1.2161 overnight, as concerns about UK-EU relations mounted after Prime Minister Boris Johnson's Cabinet reiterated it will not be extending the Brexit transition deadline beyond December, and warned that Britain will not give up its rights as an independent state in the negotiations. Chief negotiator David Frost told ministers was not asking for "anything special, bespoke or unique" in the talks, just a free-trade agreement as the EU has with other countries like Canada. The currency was already under pressure on worries over a prolonged recession due to the outbreak, a second wave of coronavirus infections and tensions between the US and China.
Published on 2020-05-15

Sterling Weakens to Over 1-Month Low
The British pound fell below $1.22 for the first time since April 6th on Thursday, as demand for safe havens increased after US Federal Reserve Chair Jerome Powell warned of a prolonged economic downturn due to the coronavirus outbreak and rulled out cutting interest rates into negative territory. Data on Wednesday showed the UK economy contracted by the most since the global financial crisis in the January-March period, with March GDP falling by a record pace due to the pandemic. On Tuesday, finance minister Rishi Sunak announced the government was extending its employee furlough programme by a further four months until the end of October, to help companies and jobs hit by the outbreak.
Published on 2020-05-14

Sterling Hits 5-Week Low
The British pound weakened below $1.23 in afternoon trading on Wednesday, touching its lowest level since April 7th, after data showed the UK economy contracted by the most since the global financial crisis in the January-March period, with March GDP falling by a record pace due to the coronavirus pandemic. On Tuesday, finance minister Rishi Sunak announced the government was extending its employee furlough programme by a further four months until the end of October, to help companies and jobs hit by the outbreak. Against the euro, sterling hit a six-week low of 88.77 pence.
Published on 2020-05-13

Sterling Hovers Around $1.23
The British pound was slightly up at $1.23 on Wednesday, after data showed the UK economy contracted by the most since the global financial crisis in the January-March period, with March GDP falling by a record pace due to the coronavirus pandemic, while markets had forecast a deeper downturn. On Tuesday, finance minister Rishi Sunak announced the government was extending its employee furlough programme by a further four months until the end of October, to help companies and jobs hit by the outbreak.
Published on 2020-05-13

Sterling Rebounds on Job Retention Scheme Extension
The British pound touched $1.235 in afternoon trading on Tuesday, before falling back to $1.231, after finance minister Rishi Sunak extended the government's employee furlough programme by a further four months until the end of October, to help companies and jobs hit by the coronavirus pandemic. Sunak told parliament that there are 7.5 million workers that are being covered by the scheme, compared to 6.3 million last week. Meanwhile, investors await government's guidelines on how to make workplaces safer as businesses slowly restart operations. According to the 51-page document on exit lockdown plans published on Monday, workers should avoid their normal physical workplace whenever possible, while non-essential retail are set to reopen from June 1st. Also, most travelers will be forced to self-isolate in their accommodation for fourteen days on arrival into the UK.
Published on 2020-05-12

Sterling Depreciates Ahead of Workforce Furlough Scheme Update
The British pound weakened towards $1.23 on Tuesday as the government is set to announce changes to its employee furlough programme later in the day as well as details on how to make workplaces safer as businesses slowly return to work. On Monday, the government published a 51-page document on exit lockdown plans at which it advised workers to avoid their normal physical workplace whenever possible, while non-essential retail will only reopen from June 1st. Also, most travelers will be forced to self-isolate in their accommodation for fourteen days on arrival into the UK.
Published on 2020-05-12