Return to Currency News Wednesday June 3rd 2020

Sterling shows signs of recovery on Brexit hopes

Headlines

  • Sterling shows signs of recovery on Brexit hopes
  • The euro remains firm
  • Dollar weakens once more, is it all going wrong for Trump?

GBP

  • The pound has staged a recovery against the dollar, moving to the highest in over a month on hopes the UK will be ale to compromise on some of the sticking points in Brexit negotiations with the EU. There are now expectations Britain will show flexibility over fisheries and trade rules if the EU come to the table on other points including regulatory alignments. Currently, Britain has till July 1st to ask for an extension. While it was after 1.25 versus the dollar, it was only 0.1% higher versus the much stronger Euro at the moment.

EUR

  • The euro was higher yesterday against most currencies, closing at $1.1205 on Wednesday. The euro is still performing well after the EC proposal to bailout virus-hit economies and furthermore, markets await news on Thursday of an increase in the ECB bond buying programme, which is expected to help members of the eurozone.

USD

  • The USD was weaker again on Wednesdays risk appetite soars following promises of more government stimulus. The dollar fell against the pound, yen and Swiss France, as investors also expressed concerns on the widespread protests in the US. President Donald Trump has threatened to use the military to quell spreading protests against racism and police brutality, but U.S. stocks continue to rally, leaving some currency traders confused about the market’s direction. There were also concerns shown regarding the US-China relationship and how trade restrictions could effect both economies. 

Other currency news

  • AUD and NZD continue to fly as economies reopen and coronavirus numbers remain near zero. They have even shrugged off US-China worries to perform well and move to multi-month highs.

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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