- Pound (GBP) picks up despite expectations of a curfew being announced today by Boris Johnson
- BoE Governor Andrew Bailey is due to speak
- Euro (EUR) trades lower as Covid cases surge & local lockdowns increase
- Eurozone consumer confidence in focus
The Pound Euro (GBP/EUR) exchange rate is rebounding on Tuesday after selling off in the previous session. The pair settled on Monday, -0.3% lower as €1.0884. At 05:15 UTC, GBP/EUR trades up +0.1% at €1.0895.
The Pound is managing to pick up versus the Euro despite Prime Minister Boris Johnson planning for all pubs, bars, restaurants and hospitality venues to close earlier. Today, the Prime Minister is expected to announce that these venues must close by 10pm in a bid to curb the spread of coronavirus. The Prime Minister is also expected to announce that these venues will be restricted to table service only. These measures will obviously hit these businesses hard.
The move comes after Britain’s tops medical advisor Chris Whitty warned that the UK will face an exponential surge in infections and deaths from coronavirus in a matter of weeks amid a rapidly spreading second wave.
Boris Johnson will address the nation this evening at 18:00 UTC.
The economic calendar is relatively quiet with just Confederation of British Industry retail trends and a speech by Bank of England Governor Andrew Bailey.
The Euro traded broadly on the back foot in the previous session, although it traded higher versus the Pound. Fears of rising coronavirus cases on mainland Europe are unnerving investors. France and Spain particularly are experiencing a huge surge in covid cases.
New lockdown restrictions have come into force in Madrid as Spain attempts to get a grip on rising covid infections. Around 850,000 people in Madrid have been told to stay at home. The move comes as Spain’s total new cases increased by more than 14,000 on Friday, making it Europe’s largest outbreak in recent weeks.
Looking ahead consumer confidence data will be in focus. The preliminary reading for September is expected for confirm -14.7. A weaker reading could drag on the Euro.