Pound (GBP) Dented by Cautious Government Outlook
The Pound (GBP) got off to a poor start this week, suffering broad losses as reports suggest the UK government is reluctant to begin easing its lockdown measures as some European neighbours have done.
Boris Johnson is reported to be wary about easing lockdown measures too soon for fears this could lead to a second outbreak of coronavirus, weakening Sterling sentiment on concerns over how a prolonged shutdown will impact the UK economy this year.
However, the Pound found some support this morning with the publication of the UK’s latest employment figures. The report detailed a far more modest increase in people claiming unemployment benefits last month than had been forecast.
Euro (EUR) Stalls on Mounting Tensions in the EU
The Euro (EUR) was mostly directionless on Monday as tensions in the EU mounted ahead of Thursday’s video conference.
The EU remains divided on the issuing of joint debt, despite French President Emmanuel Macron recently warning that the EU is facing a ‘moment of truth’ in its fiscal response to the coronavirus.
EUR investors will be focused on the latest ZEW surveys this morning. Will another plunge in economic sentiment weigh on the Euro?
US Dollar (USD) Climbs in Risk-Off Trade
The US Dollar (USD) rallied during yesterday’s session as the collapse of US oil prices sent skittish investors flocking towards the safe-haven currency.
Also buoying USD exchange rates are ongoing concerns over the coronavirus pandemic, which has left global economic growth at a standstill.
Coming up today we may see the US Dollar relinquish some of its gains with the publication of March’s housing figures, with economists predicting a sharp fall in existing home sales.
Canadian Dollar (CAD) Undermined by Tumbling Oil Prices
The Canadian Dollar (CAD) trended lower on Monday as a sharp plunge in US oil prices took a toll on the commodity-linked ‘Loonie’.
WTI crude prices actually turned negative at the start of the week, with producers resorting to paying buyers to take excess supply amid concerns that US storage space is quickly running out.
Australian Dollar (AUD) Slumps as Oil Collapse Spooks Markets
The Australian Dollar (AUD) tumbled in overnight trade on Monday as US crude’s record drop below zero spooked markets and greatly limited the appeal of the risk-sensitive ‘Aussie’.
New Zealand Dollar (NZD) Tumbles on RBNZ Stimulus Hints
The New Zealand Dollar (NZD) also dove in overnight trade, with the ‘Kiwi’ retreating after the Reserve Bank of New Zealand’s (RBNZ) governor Adrian Orr dropped hints at future stimulus measures, including direct debt monetisation.