The Pound continues to struggle to make any further gains against the Euro due to a lack of progress over post-Brexit trade negotiations with the EU. Health Secretary Hancock has said that new countries could join Spain and be added to the quarantine list over the next few days. UK-Japan trade negotiations are set to run over its July deadline although most of the agreement has been settled. UK car production has fallen by 42% to its lowest level since 1954.
ECB member Villeroy has said that the French economy may slightly beat forecasts of a 10% economic contraction and expects French economic activity to return to pre-crisis levels in 2022. Spanish flash consumer price inflation data released this morning disappointed the market with a release of -0.6% compared to -0.3% that had been forecasted. The Eurozone unemployment rate is due to be released at 10am which will be closely watched by the market. The Euro remains strong against the Dollar.
Yesterday, the Federal Reserve left interest rates on hold between 0-0.25% as expected but struck a dovish tone as the central bank has pledged to continue to keep rates low until the US economy is back on track. Federal Reserve Chairman Powell has reiterated that the US economy will continue to suffer unless the number of new coronavirus cases falls which kept the Dollar under pressure. US unemployment claims as well as GDP data is due at 1:30pm which is likely to cause some short-term volatility.