British pound-Euro exchange rate settled in the previous session at €1.1484.
At 06:30 UTC, GBP/EUR traded -0.15% lower at €1.1462 as Pound investors mull over the prospect of a longer lock down, whilst Euro investors look ahead to GDP data and the European Central Bank monetary policy announcement.
GBP: Pound Under Pressure As Deaths Pass 26,000
New daily coronavirus figures show that over 26,000 people have died from the virus in the UK. This is a jump by almost a fifth on previous reports as the government started to include coronavirus deaths in the wider community, rather than the previously used hospital number. The UK now has the second highest death toll in Europe.
The UK government is under pressure to ease lock down measures to open shops and services as Britain braces itself for the worst recession in decade, with a wave of unemployment. However, Prime Minister Boris Johnson will say that there will be no changes to lock down when he gives his first press conference, later today, since returning to Downing Street
EUR: ECB To Expand QE
Today is a very busy day for the euro. The Eurozone economic calendar is jam packed with high impacting releases across the start of the European session. These include German retail sales, Eurozone inflation and German unemployment data. However, the most closely watched events are expected to be the release of Eurozone GDP data and the ECB monetary policy announcement.
Analysts are expecting the Eurozone economy to have contracted in the first three months of the year by -3.3% on an annual basis. This will be sharply down from the 1% increase experienced in the final quarter of 2019, as it reflects the first few weeks of lock down. Recent data has had a tendency to surprise to the downside, so a weaker than forecast number could be on the cards.
The ECB are not expected to adjust interest rates at the monetary policy meeting. However, after the EU leaders failed to agree on a group-wide economic recovery fund, analysts are expecting the ECB to attempt to pick up the slack.
The central bank has already announced a €750 billion bond buying programme the Pandemic Emergency Purchase Programme. Analysts believe that the ECB could expand the scope of their bond buying to include junk bonds. A strong, reassuring move by the central bank could boost the euro.
