The Financial Times have reported that the EU are willing to compromise on the issue of competing on a level-playing field when it comes to aligning regulation at the end of the transition period. Nonetheless, the Pound has struggled to make gains against the Euro and a stronger Dollar. The Bank of England’s quarterly bulletin released at midday will be the focus for the Pound with the market ready to scrutinise any Brexit and coronavirus related comments. UK trade minister Truss believes that the proposed tariffs on some UK and EU goods by the US is disappointing but urged against retaliating with tariffs of their own.
German consumer climate figures beat the market’s expectations at -9.6 which gave the Euro a slight boost against the Pound. ECB member Knot has mentioned that there are signed that the Eurozone economy is beginning to recover. The ECB has also commented that their quantitative easing measures as well as their PEPP stimulus have been effective in helping the economy minimise further downside risk.
US GDP data came out as expected at -5.0% although the number of unemployment claims was higher than expected with a release of 1480K compared to 1320K that was forecasted. This led to a more risk-averse environment which ultimately kept the Dollar strong against both the Pound and Euro. In addition, the number of virus cases and deaths in the US have continued to increase which has worried the market boosting the Dollar’s safe-haven status. US consumer sentiment and inflation expectations are due to be released at 3pm which is likely to cause some volatility for the greenback in the afternoon.