Let us check the market. Today we will discuss changes in the United States dollar, pound, and others. Weak inflation has driven speculation that the Bank of England might cut interest rates below zero. Thus, the pound remains under pressure, has been spared some losses after the PMI data was released.
Against the euro, Sterling was down 0.08% at $1.2227 and lost only 0.04%.
Chris Beauchamp is Chief Market Analyst at IG. He said that some improvement in the United Kingdom figures had bolstered the pound.
So we can see that risk appetite is broadly on the back foot. Against a basket of its rivals, the United States dollar rose by 0.13% to 99.30. China-United States tensions tightened in the meantime. Thus, United States futures were trading in the red.
In recent weeks, Diplomatic relations between the world’s two biggest economies have soured. The US President, Donald Trump, attacked China’s handling of the coronavirus outbreak.
The United States Dollar and Others
On Wednesday, the United States President Donald Trump accused China in a massive disinformation campaign. As he said, the campaign sought to damage his re-election chances. Moreover, Trump said that China continues to rip off the United States. The latest salvo most likely came as a result of this.
In onshore trade, the US dollar was slightly up in comparison to the Yuan, edging 0.1% higher to 7.1001.
Moreover, there was the optimism of a closer fiscal union in Europe. It thus fueled a four-day rising streak. It then fizzled out due to United States-China tensions and some concerning economic data coming to the fore. Thus, on Thursday, the euro steadied.
On Monday, Germany and France proposed a $543 billion (500 billion euro) recovery fund. Thus, it is offering a grant to those regions and sectors hit hardest by the coronavirus pandemic. This is raising hopes that European policymakers will take more decisive steps for tackling economic damage.
Thus, the news lifted the euro from levels around $1.08. It had been languishing for the last two months, after which this news pushed it towards $1.10.
