- Upbeat Brexit comments from Irish PM help support the Pound (GBP)
- CBI report reveals UK retail jobs are being lost at the fastest rate in a decade
- US Dollar (USD) recovers after weak consumer confidence data dragged on the greenback on Tuesday
- US durable goods data expected to reveal a 4.3% increase in July
The Pound US Dollar (GBP/USD) exchange rate is slipping lower heading toward the London open. The pair settled higher on Tuesday +0.67% at US$1.3150. This was at the upper end of the daily traded range.
At 06:15 UTC, GBP/USD is still holding most of those gains, trading -0.1% at US$1.3138.
News that the University of Cambridge is planning to start clinical trials for its covid vaccine in the Autumn is underpinning the Pound against the stronger Dollar, along with a hint of Brexit optimism.
Newly elected Irish leader Michael Martin said that he believed that the UK and the EU were within the landing zone of a Brexit deal. His comments came after meeting with UK Prime Minister Boris Johnson for the first time since he was elected in June.
The encouraging comments were well received after Chief EU Negotiator Michel Barnier dashed hopes of a trade deal being reached on Friday, sending the Pound plummeting.
Concerns surrounding the UK labour market are weighing on sentiment after a report from the Confederation of British Industry (CBI) showed that jobs in the retail sector were being lost at the fastest rate since the financial crisis. The situation is only going to get worse as the government withdraws from the job retention scheme.
The US Dollar took a hit in the previous session after data revealed that consumer confidence tumbled to the lowest level in 6 years amid growing concerns over coronavirus induced job losses. Consumer spending could slow over the coming months as a result of the hit to confidence, which could damage the US economic recovery further.
Today US economic data will remain in focus with durable goods orders due later in the session. Durable goods orders are expected to increase +4.3% in July after a 7.6% increase in June.
Looking ahead Federal Reserve Chair Jerome Powell’s key speech at the virtual Jackson Hole summit is moving into focus. Analyst believe that Jerome Powell could use the stage to send a dovish message ahead of the Federal Reserve monetary policy meeting next month.
