Coronavirus Fears Dampen The Pound


Sterling extended its downtrend to five consecutive days against the USD and three consecutive days against the Euro. The majority of Sterling’s weakness is being attached to fresh coronavirus fears over new variants and continued issues over Brexit talks.

French fishermen are set to block the channel tunnel and major ports today in anger surrounding fishing licensing rules. The French interior minister has also today cancelled talks with UK Home Secretary Priti Patel after PM Boris Johnson called on France to take back migrants that have crossed the channel into the UK.

The French Interior Minister has not however cancelled talks with Germany, Netherlands, Belgium and the European Commission. EU Brexit officer Maros Sefcovic is set to continue talks with the UK today over the Northern Ireland border protocol, any progress with this issue is likely to be positive for the Pound.

Bank of England Governor Andrew Bailey yesterday played down inflation fears and criticised Central banks for offering guidance on interest rate hikes during times of economic uncertainty. Bailey stated that he wasn’t and doesn’t plan to be explicit on when rate rises are likely to happen.

Key announcements

08:00: EUR ECB’s President Lagarde speech