GBP/EUR: Brexit Extension & EU Trade Tariffs In Focus
  • Pound (GBP) slides as UK says no to more Brexit talks
  • Wales will go into 2-week lockdown starting Friday
  • Euro (EUR) pushed higher amid an absence of data
  • German PPI data and Eurozone current account in focus

The Pound Euro (EUR/USD) exchange rate is extending its losing run. The pair settled -0.3% lower on Monday at €1.1002, at the lower end of the daily traded range. At 05:15 UTC, GBP/EUR trades -0.1% at €1.0989.

Both Brexit and Covid headlines are dragging on the Pound leaving little for sterling investors to cheer. Wales announced that it will impose a two-week circuit breaker lockdown starting on Friday. Everyone but essential workers must stay at home in a bid to stem the spread of the virus. However, at the same time the move could be the final hit for many businesses and shops struggling to get back on their feet after the first lockdown.

All four countries are seeing a resurgence in covid cases. The UK recorded just shy of 17,000 new covid cases over the past 24 hours. Northern Ireland has also announced that it will also impose a 2 -week lockdown.

Brexit news was unsettling for the Pound. According to Michael Gove, a senior politician, the UK sees no reason to continue talks with the EU unless Brussels has a fundamental change in approach. Michael Gove had previously said that the door was still ajar for further discussions. It appears that the UK is heading for a no trade deal Brexit.

Euro traded broadly higher versus its peers in the previous session under the guise of no news is good news.  The Euro managed to maintain gains despite risk averse trading and surging covid cases across the old continent.

There was no data in the previous session to drive the common currency and the slew of European Bank Central speakers failed to add anything new to drive to Euro.

Today German inflation at wholesale level, as measured by Producer Price Index and the Eurozone Current Account are the only two data releases.