Yesterday, Parliament passed an emergency bill giving the government further power to take further steps in order to combat the impact of the coronavirus which will be voted on in the House of Lords today.
Prime Minister Johnson has ordered people to work from home if they can for the next 3 weeks and only to leave their house for ‘very limited purposes’. This news gave some support to the Pound against both the Euro and Dollar as this lockdown is seen as a necessary step in the right direction.
ECB member Villeroy has said that the central bank will introduce some more stimulus as early as tomorrow. German Economy Minister Altamier believes that the country will have to return to austerity in order to pay back the debt used during the pandemic, and has committed to doing this by 2023. This is in reference to the fiscal package agreed by the German government yesterday amounting to €750bn. This morning, flash German manufacturing data came out better than expected whilst services PMI figures disappointed the market.
Although the Dollar has seen a lot of demand due to its safe-haven status, there has been some slight weakness as the US Senate struggles to get their rescue package approved. The Federal Reserve has announced that they will be buying an unlimited number of Treasury bonds and other debt instruments in order to further stimulate some economic growth. US manufacturing and services PMI data is due later this afternoon and is likely to cause some short term volatility.