Daily Currency Update
GBP - British PoundHello and welcome back following a sunny Easter weekend. As the UK enters its fourth week in lockdown it was announced that Boris Johnson on Sunday left hospital after recovering from coronavirus. As some European countries think about re-opening it strongly looks like the UK will extend its own lockdown timeframe. Whilst there is little to look out for on the data front this week from Europe investors will be looking very closely at how countries such as Spain and Italy begin to re-open. In Italy, Prime Minister Conte has said that book and stationary shops can reopen whilst in Spain we could see the return to normal for the construction and manufacturing sectors. As things stand this morning the Euro is flat against the USD whilst under some early pressure from the pound.
Key Movers
Apart from the 'epic' press conference from President Trump yesterday (epic in terms of length and also because it was remarkable to watch) the big news over the weekend was the fact that the OPEC+ nations decided to cut oil production by 9.7 million barrels per day which saw the commodity currencies of Australia, New Zealand and Norwegian Krona claw back some loses. The main event this week will come in the form of the US March Retail sales which are due to be released on Wednesday followed by the weekly US Unemployment Claims on Thursday. Unlike in the UK where the services sector drives the economy and accounts for 80% of UK GDP, in the US retail spending is the backbone and king. This is not surprising given the very consumer focused nature of the US which means that 66% of its GDP comes from this sector. Worryingly investors are forecasting spending to come in at -8% and quickly scrolling through my old notes this morning US retails spending never dropped below -3% during the GFC. A big week indeed for the US and its future recovery.
Expected Ranges
- GBP/USD: 1.2380 - 1.2600 ▲
- GBP/EUR: 1.1400 - 1.1520 ▲
- GBP/AUD: 1.9500 - 1.9650 ▼
- GBP/NZD: 2.0480 - 2.0600 ▼
- GBP/CAD: 1.7350 - 1.7500 ▲