Yesterday, the Pound initially continued to weaken with worse than expected flash services PMI figures being released along with manufacturing PMI data that was released as expected. However, news that Chancellor Sunak will unveil an employment plan aimed at replacing the furlough scheme that is expiring at the end of October gave the Pound a boost. Sunak will be speaking at 11:45pm at the House of Commons which will be closely watched by the market.
Eurozone flash manufacturing PMI beat expectations whilst flash services PMI disappointed the market. This led to the Euro trading in a tight range for most of the day. Germany has reportedly approved its 2021 draft budget with €96.2 billion in new debt set to be used to tackle the pandemic which is the second-highest since the end of World War II.
The Dollar remains strong due to its safe-haven status as concerns mount over the global economic recovery from the coronavirus pandemic and also a lack of extra monetary stimulus in the US. FOMC member Rosengren believes the pandemic will continue to get worse during the Autumn and Winter.