In the face of increasingly partisan politics, the 2020 US presidential election was already set to be one of the most polarising elections in living memory.
- Pound edges higher on speculation the currency is undervalued
- Cracks in EU unity weaken EUR exchange rates
- Rising risk appetite undermines USD
Pound creeps higher ahead of heavy-data week
The pound crept higher at the end of last week on suggestions that the UK currency remains undervalued following its sell-off last month.
GBP investors will be kept busy this week with a slew of high impact releases, which should provide some more insight into how the coronavirus crisis is impacting the UK economy.
Important UK releases include unemployment and wage growth figures, the nation’s consumer price index, manufacturing/services PMI and retail sales numbers.
ZEW surveys in the spotlight
The euro struggled to find direction on Friday, with EUR investors increasingly wary that the coronavirus crisis is taking its toll on EU unity.
Observers raised concerns that EU countries have so far failed to agree on a coordinated lockdown exit strategy, raising questions about the future of the EU.
The focus at the start of this week will be on the latest ZEW surveys, with the euro potentially suffering as analysts predict a sharp drop in Eurozone economic sentiment in April.
US dollar’s gains capped by hopes for coronavirus treatment
After soaring on Thursday, the US dollar came to an abrupt halt at the end of last week on reports that drug trials for a possible coronavirus treatment were progressing well.
US Pharmaceutical company Gilead Sciences claimed that trials of its new antiviral medication had resulted in nearly all test patients with respiratory symptoms discharged within a week.
Market sentiment surged on hopes the new drug could help countries begin rolling back their lockdown measures, leading to a decline in demand for the safe-haven ‘greenback’.
This week investors will be keeping a close eye on Donald Trump as the US President pushes for states to begin reopening.
Monday, 20th April 2020
10:00 EUR Eurozone Trade Balance
13:30 USD Chicago Fed National Activity Index
Joining the corporate trading desk in 2007, Phil now over sees all of Currencies Direct’s corporate dealing activity. Having gained experience working with hundreds of businesses to optimise international payments processes and execute comprehensive risk management strategies, Phil currently works with a portfolio of corporate clients whilst managing Currencies Direct’s overall market exposure
Phil has FCA approval and has completed the Certificate in International Treasury Management (CertiTM)