The Pound has lost some ground against both the Euro and the Dollar after reports emerged that Bank of England Governor Bailey told the banking sector to prepare to leave the EU without a deal. Germany’s ambassador to the EU has said that there has been ‘no real progress’ during the latest round of UK-EU trade negotiations and confirmed that the EU is assuming that the UK will refuse to extend the Brexit transition period.

Yesterday, Europe’s unemployment rate came out at 7.3% compared to 8.2% that was forecasted which gave the Euro some continued support. The market is looking towards the ECB interest rate decision and speeches this afternoon and although it is expected that interest rates will stay the same, analysts believe that the ECB is set to announce an increase in the level of their quantitative easing programme. Comments made by ECB President Lagarde will be closely watched for any further details.

A flurry of US economic data was released yesterday afternoon including non-farm employment change figures as well as non-manufacturing PMI and factory order data, all of which were released better than expected which gave the Dollar some renewed strength. With China banning American airline carriers from re-entering, the US has retaliated by banning four Chinese airline carriers from coming into the US from 16th June. With tensions increasing between the two parties, investors kept to a more risk-averse attitude causing the Dollar to strengthen. US unemployment claims data will be released at 1:30pm today.