The Pound is extending losses versus the stronger US Dollar in early trade on Monday. The Pound versus US Dollar exchange rate shed over 1% in value on Friday after the first decline in US payrolls since September 2010. The pair closed the previous week 1.5% lower at US$1.2262, after gaining 7% the prior week.
At 07:30 UTC, GBP/USD is trading -0.4% at US$1.2230 on news that UK prime Minister Boris Johnson has been admitted to hospital.
PM Boris Johnson Hospitalised
The Pound has slipped across the board as the hospitalisation of the Prime Minister has naturally unnerved investors. Hus transfer from Downing Street comes as the number of coronavirus cases in the UK passes 47,000 and the number of deaths closes in on 5,000.
Also dragging on sterling is news that consumer confidence has plunged by the most on record. The lock down has hammered household’s financial outlook, causing morale to tumble the most in 45 years, according to institute GFK.
Investors will now look towards the UK construction purchasing managers data. Analysts are expecting activity in the sector toy contract to 46 in March. This would be a decline from 52.6 in February as the impact of coronavirus start to show up through in the data. The figure 50 separates expansion from contraction.
The reading will come after the manufacturing and service sector pmi’s revealed record declines, last week.
US Dollar Steady As Death Toll Slows
The US Dollar is trading broadly flat versus its major peers at the start of the week as the mood in financial markets shows signs of improving. Investors are cheering signs that the places worst hit by coronavirus are showing strong signs of improving. Italy is even considering how to end its lock down. The slowing death toll comes as the US prepares for its worst week ahead.
The US Dollar advanced on Friday owing to its safe haven properties after the US unemployment report broke a run of 113 consecutive monthly job gains.
The US lost 701,000 jobs in March, well short of the -100,000 forecast, as coronavirus containment measures resulted in many businesses closing, with staff laid off. The cut off for the report was March 12th, so these figures are just the start.
US initial jobless claims data showed that around 10 million American’s filed for unemployment benefits.
