Return to Currency News Tuesday June 2nd 2020

Sterling bounces back

Headlines

  • Sterling bounces back
  • Eurozone shows improved data
  • Dollar weaker as risk sentiment improves

GBP

  • The pound was at a one month high versus the dollar on Monday, as risk appetite improved along with hopes that the economy will improve quicker than expected post lockdown. While this was the case yesterday, investors will be looking to Brexit related risks, speculation about negative rates also well as any developments on the coronavirus pandemic before deciding what direction to take sterling. Against a broadly weaker dollar, the pound hit a four-week high of $1.2488 around 1500 GMT. It was last at $1.2456, up 0.9% on the day. Versus the euro, the pound strengthened around 0.8%, last at 89.22 pence, having gone as low as 89.17 earlier in the day.

EUR

  • The euro pushed higher once more versus the dollar pushing to a high of 1.1131, up over 0.3%. The eurozone showed improved figures in manufacturing from April to May which was welcomed, however they are still showing the biggest drop in a decade. 

USD

  • The dollar was lower again as investors bet on a quicker global economic recovery as well as showed concerns on the growing unrest domestically. Trump has now vowed to deploy the army if this continues which again will weigh on the dollar should this cause further tensions. There were also concerns about the US’s relations with China and how that may play out regarding trade deals. The USD index was lowest since mid march, trading around 97.885.

Other currency news

  • The Yuan has hit a low of 7.1854 verist he dollar as Trump imposed further tariffs on Chinese products. However, that did not effect the Australian Dollar who continued to perform well trading at 0.6789 versus the dollar. 

Amir Mehrad
Market update by Amir Mehrad

14 years experience in deliverable foreign exchange, over 7 as CEO of Effective FX

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