The Pound has made gains against a weaker Euro and Dollar with manufacturing PMI data coming out better than expected. With both the UK and EU intensifying trade negotiations, the market remains cautiously optimistic that a deal can be done before the end of the year. However, worries have started to amount about the economic impacts of a second lockdown. This in turn has led the market to anticipate a more aggressive stance by the Bank of England at their policy meeting on Thursday.

The Euro remains under pressure with some of the main EU nations reimposing lockdown restrictions. France reported 52,518 new coronavirus cases on Monday whilst Italy is due to introduce a three-tier system across the country as well as a limit on movement and night-time curfews.

The Dollar has experienced some weakness as the market now focuses on the US presidential election. The market is taking a more risk-on approach as the polls suggest that Democrat Biden is likely to win although it is still a very close contest especially in the battleground states such as Florida. It is also expected that Biden would introduce a larger fiscal stimulus package than President Trump would.