gbp-british-pound-coin - GBP
  • EU-UK policymakers aim for intense talks in Brussels. The EU are looking for compromise, the UK is looking less flexible.
  • Optimism surrounding Boris Johnson’s infrastructure spend boosts Pound (GBP)
  • Risk sentiment is weak as coronavirus second wave fears remain and local lockdowns look likely
  • Pound US Dollar exchange rate (GBP/USD) rebounds, target US$1.24

The Pound is picking up versus the US Dollar (USD) at the start of the week. The Pound US Dollar exchange rate lost -0.2% across the previous week, settling on Friday US$1.2335 just up from a 5-week low hit earlier in the session.

At 06:15 UTC, GBP/USD trades +0.27% at US$1.2370, snapping three consecutive sessions of losses.

EU UK post Brexit trade talks start again today and will be key for the Pound. A team of 20 British diplomats headed to Brussels on Sunday for intense face to face talks, the first since Boris Johnson and EU leaders had a video conference to inject political momentum into the process. Whilst there is still hope of a deal being achieved, issues such as fishing, EU judicial power and “the level playing field” remain contentious.

In other news, Boris Johnson unveiled £1.2 billion infrastructure investment. The Prime Minister will make a speech on Tuesday to set out plans for fast track building projects such as schools, hospitals , housing road and rail in an attempt to get Britain moving  again after covid-19.

The US Dollar is trading broadly lower versus its peers, although the mood in the market remains cautious as the number of coronavirus cases across the globe hits 10 million with 500,000 deaths recorded.

The US continues to struggle with rising daily cases in some states. California’s Governor has ordered that all bars close immediately in 7 counties across the state, including Los Angeles, owing to the rapid increase in coronavirus infections over the past two weeks.

However, this was also offset by news elsewhere in New York, Europe and Asia of reopening and economic rebound. According to the Chinese national bureau of statistics, profits at Chinese industrial firms rise for the first time in 6 months in May offering some support to risk sentiment.

Data wise US pending homes sales will be in focus later today, ahead of speech by Jeremy Powell tomorrow and US non farm payrolls later in the week.


Currencylive.com is a news site only and not a currency trading platform.
Currencylive.com is a site operated by TransferWise Inc. ("We", "Us"), a Delaware Corporation. We do not guarantee that the website will operate in an uninterrupted or error-free manner or is free of viruses or other harmful components. The content on our site is provided for general information only and is not intended as an exhaustive treatment of its subject. We expressly disclaim any contractual or fiduciary relationship with you on the basis of the content of our site, any you may not rely thereon for any purpose. You should consult with qualified professionals or specialists before taking, or refraining from, any action on the basis of the content on our site. Although we make reasonable efforts to update the information on our site, we make no representations, warranties or guarantees, whether express or implied, that the content on our site is accurate, complete or up to date, and DISCLAIM ANY IMPLIED WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE. Some of the content posted on this site has been commissioned by Us, but is the work of independent contractors. These contractors are not employees, workers, agents or partners of TransferWise and they do not hold themselves out as one. The information and content posted by these independent contractors have not been verified or approved by Us. The views expressed by these independent contractors on currencylive.com do not represent our views.