The Pound is registering minor gains in a relatively inactive session on Good Friday. UK and European stock markets are closed to for the extended Easter weekend holiday.
The is the fourth straight session that the Pound is advancing against the US Dollar.
The Pound US versus Dollar rallied 0.5% across Thursday, settling at US$1.2452 after the Federal Reserve unveiled further support for the market and the economy and as Boris Johnson left intensive care.
At 07:30 UTC, GBP/USD is trading at +0.1% at US$1.2464 as investors digest the latest coronavirus headlines and ahead of US inflation data.
The Pound US Dollar is on track for gains of 1.6% across the week, recouping last week’s 1.6% loss.
Pound Steady on Boris Optimism, Despite Lock Down Extension
The Pound is consolidating gains after a strong push higher this week. News that UK Prime Minister Boris Johnson is out of intensive care is underpinning sterling. However, news that the UK will remain on lock down for the foreseeable future as daily deaths remain elevated is dragging on demand. The longer the lock down continues to harder the economic hit.
Data on Thursday revealed that the UK economy grew just 0.1% in the three months to February. The statistics from the Office for National Statistics also show that the economy contracted -0.1% during February. The numbers are concerning because they show that the UK economy was already struggling ahead of the coronavirus outbreak and the lock down measures implemented to slow the spread of the virus.
Will US Inflation Pull US Dollar Lower ?
The US Dollar traded on the back foot across the week amid a broad improvement in risk sentiment as investors gained in optimism that the coronavirus. On Thursday, the Fed announced that it took additional action to make $2.3 trillion in loads available to support the economy. The news came after data showed that the number of people signing up for unemployment insurance in the week ending 3rd April jumped to 6.6 million, in line with the previous week.
Today Dollar investors will look ahead to US inflation data. The consumer price index for March is expected to show a sharp decline -0.3% month on month, down from a 0.1% gain in February. This will be its biggest monthly decline in three years hit by tumbling oil prices and low US consumption. As weak reading could drag the US Dollar lower.