The British pound is higher against the euro on Monday.
There are tentative signs that the coronavirus ‘curve’ is flattening in some European countries including Spain, Italy and Germany but the high numbers of cases is keeping the euro offered.
A surprise comment from UK PM Boris Johnson’s spokesman that technical trade talks are ongoing via telephone gave the pound a small lift.
Pound versus Euro was higher by 81 pips (+0.73%) to 1.1256 with a daily range of 1.1125 to 1.1277 as of 4pm GMT.
GBP/EUR added to strong gains last week (+2.71%) with an afternoon rally that carried it 100 pips from below 1.115 to above 1.125.
British Pound
Prime Minister Boris Johnson’s spokesman James Slack said on Monday that technical trade talks will still take place this week by phone. It came as a small surprise since last week officials in the European Union had said that post-Brexit trade talks had been sidelined indefinitely.
The lead negotiators from both sides were in self-isolation after having coronavirus symptoms so the fact that trade talks had stopped at the official level was no surprise, and had been priced into a weaker pound well in advance.
Euro
Markets are paying closest attention now to Spain and Germany, the countries with the highest coronavirus infection rate and biggest economy respectively.
The Robert Koch Institute (RKI) reported 57,298 cases in Germany, up by 4,751 cases from yesterday which represents a 9% increase. It’s the second day in a row with an increase of less than double digits in percentage terms. Officials in Germany acknowledged the small progress but said the speed of the virus spread is foot fast to think about loosening lockdown restrictions.
Spain confirmed another 812 coronavirus deaths, which is slightly less than yesterday but still a frightening amount in one day. The number of cases rose to 85,195 from 78,797 yesterday which is an increase of 8%.
Inflation data was released for Germany. The region of Saxony saw a decline to price growth of +1.6% from 2.0% year-over-year but the cause seems to almost entirely energy prices because core CPI remained steady at 1.9%.
