Sterling has begun the day under pressure in response to Brexit news. The trade talks which appeared to be on the verge of a breakthrough at the beginning of the week have once again hit problems. Overnight French European affairs secretary Clement Beaune said there is a risk that there will not be a Brexit deal. He added that France would veto any deal that it does not deem satisfactory. This comes after UK officials said on Thursday that the talks had taken a big step backward after the EU had hardened its position in response to French concerns that chief negotiator Michel Barnier was willing to give too many concessions to get the deal over the line. Barnier is expected to return to Brussels today for consultation talks with EU leaders.

German factory orders for October came in better than expected this morning. This reaffirmed a more robust manufacturing sector despite the increase of coronavirus cases across the country. The data was especially encouraging as the orders passed pre-covid crisis levels. In February the index was 102.4 but last month it came in at 103.4 feeding renewed optimism regarding the Germany economy.

The dollar is this morning trading above the lows hit yesterday as traders await the all-important non-farm payroll report for November released later today. The greenback’s fall stalled after Senate majority leader McConnell said he prefers a small relief deal rather than the $1 trillion being discussed in talks. This dampened hopes earlier this week that a deal for a coronavirus relief package was close.