With members of the Cabinet suggesting that Prime Minister Johnson is recovering well, the Pound has strengthened over the past 24 hours although it will remain volatile as the market awaits further updates on his condition.
Today, the emergency Cobra committee will meet to discuss whether current restrictions should be extended, with Foreign Secretary Raab chairing the virtual meeting whilst Johnson spends another night in intensive care. This morning, UK GDP data suggested that the economy contracted by 0.1% for the month of February whilst manufacturing production beat the market’s expectations.
The Euro remains under pressure as finance ministers from across the EU once again failed to come to an agreement for a coordinated response to the virus outbreak, with discussions continuing today at 3pm. Italian PM Conte has said that the European Union risks collapsing if they cannot agree on a way to help countries that have been impacted the most by the virus. In addition, analysts believe that Germany could be heading for a recession with a 9.8% contraction in economic growth in the second half of 2020.
US unemployment claims will be closely watched by the market and will help decide which direction the Dollar is likely to go to. Democrats have set out their demands for further economic stimulus focusing on small businesses and hospitals. In the most recent FOMC meeting minutes, members predicted continued uncertainty for the US economy going forward.