The Pound has strengthened against a weaker Euro but struggled against a stronger Dollar. There are growing fears that the government will have to introduce stricter lockdown measures to curb increasing coronavirus cases which in turn has undermined the Pound. With a lack of Brexit related news, the market has generally focused on the other main currencies which have been in the headlines.
The Euro has continued to weaken as the ECB has told EU governments to spend money to stimulate their economies, with rumours of further monetary action in December. This morning, German retail sales data disappointed the market with a release of -2.2% compared to -0.6% that was forecast. Preliminary GDP for Germany, Italy, and the Eurozone will be released this morning along with unemployment rate figures which are likely to cause some short-term volatility.
The Dollar has continued to remain in the market’s favour until the early afternoon as advanced GDP figures came out better than anticipated. In addition, unemployment claims were released at 751K compared to the anticipated total of 773K. However, the market then chose to focus on the presidential election polls which show Biden extending his lead against President Trump. This has gradually weakened the Dollar since.