On 13 June, the UK government revealed legislation that would allow it to scrap parts of the Northern Ireland protocol.
- Sterling gains after wage announcement
- Euro stabilises on New Year’s Eve
- US dollar extends losses
Pound bolstered by wage news
The pound trended higher on New Year’s Eve, bolstered by hopes that a notable bump in minimum wage will help to boost growth in the UK this year.
Johnson announced that the national living wage, paid to those over 25, will rise by 6.2% in April.
A rise of over four times the rate of inflation, GBP investors hope the bump in wages will help to support economic growth in 2020 by bolstering consumer spending.
However, the pound may sour at the start of 2020 with the publication of the UK’s manufacturing PMI, with December’s final reading set to confirm growth in the UK’s factory sector slumped to a seven-year low.
Euro steady on hopes for 2020
The euro held steady on New Year’s Eve, with a more optimistic outlook for the single currency in 2020 offering some support to EUR exchange rates.
After falling in both 2018 and 2019, analysts are forecasting the euro will fare better in 2020 as the Eurozone economy final starts to turn a corner.
For EUR investors the focus in the second half of the week will be Germany’s latest CPI figures, with the euro set to rise if domestic inflation accelerated in line with expectations last month.
US dollar hits five-month low
The US dollar ended the year on a sour note on Tuesday, slipping to a five-month low as a risk-off mood in markets saw investors remain bearish towards the safe-haven currency.
The US dollar may remain under pressure as the publication of the ISM manufacturing PMI on Friday is expected to show growth in the US factory sector contracted again in December.
09:30 GBP Markit Manufacturing PMI
14:30 CAD RBC Canadian Manufacturing PMI
14:45 USD Markit Manufacturing PMI
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)