GBP/DKK Exchange Rate Rises as High Danish Unemployment Weighs on Danish Krone
The Pound to Danish Krone (GBP/DKK) exchange rate fell by 0.2% today, with the pairing currently trading around 8.299kr.
The Danish Krone (DKK) struggled to gain against Sterling today following the release of October’s Danish Unemployment Rate, which rose by 4.1%.
Nevertheless, unemployment remains relatively high with February’s gross unemployment rate being just 3.7%.
However, Denmark’s flash GDP data for the third quarter rose from -6.8% to 4.9% quarter-on-quarter.
Analysts at Danmarks Radio commented on the data:
‘The current record high growth is first and foremost due to the historic collapse in the economy because of the ‘corona(virus) hit’. We are on our way up out of a deep hole and there is still some way to go until we are all the way up.’
Danish Krone investors will continue to monitor Denmark’s economy as November draws to a close.
With Covid-19 threatening to severely impede the nation’s economic recovery in the months ahead, Danish markets are remaining largely cautious.
Pound (GBP) Rises Despite Lack of Brexit Progress
The Pound (GBP) edged higher today despite growing concerns over the lack of progress in UK-EU Brexit trade talks.
Last week saw the EU’s Chief Brexit Negotiator, Michel Barnier, comment that the two sides had almost reached breaking point.
German Chancellor Angela Merkel also said that the EU was becoming ‘impatient’ over the lack of progress in negotiations.
As a result, GBP investors are becoming increasingly jittery as there is still no signs that the two sides can come to a consensus on a trade agreement.
In UK economic news, today saw the release of October’s UK Mortgage Approvals data, which beat forecasts and rose by 97.5 thousand.
Analysts at Reuters commented:
‘Britain’s housing market has gone into top gear in recent months, propelled by demand for bigger properties from people who were locked down at home in the spring and an emergency tax cut for buyers that is due to expire in March.
‘The housing recovery looks increasingly at odds with a renewed slowdown in the economy and a rise in unemployment that looks set to peak only next year.’
GBP/DKK Outlook: Could a Lack of Brexit Consensus Send Sterling Tumbling This Week?
Danish Krone (DKK) investors will be awaiting tomorrow’s release of the latest Danish Manufacturing PMI for November.
Any improvement in Denmark’s economic outlook would prove DKK-positive.
Denmark’s Covid-19 situation will also remain in focus. If the number of coronavirus infections rises, then we could see the Danish Krone suffer.
Pound investors will be eyeing tomorrow’s release of November’s UK Manufacturing PMI.
If this beats forecasts and edges higher, then we could see Sterling edge higher.
However, if there is still a lack of clear consensus on Brexit, the GBP/DKK exchange rate would likely continue to sink.