The British pound took early week hits on both broadly negative risk sentiment, rising coronavirus cases, and potential lockdowns coming to the U.K.
But traders changed their tune on Sterling mid-week as rhetoric on Brexit improved from various top EU and U.K. officials, positive economic updates from the U.K., and additional stimulus was announced to help the U.K.’s employment situation.
United Kingdom Headlines and Economic data
Monday:
UK heading for 50,000 coronavirus cases per day if no action is taken, government scientists warn
UK manufacturers see little sign of ‘V’-shaped recovery
UK ‘at critical moment’ in controlling virus spread, says Grant Shapps
Tuesday:
EU-UK Brexit talks challenging, Simon Coveney claims
BOE Governor Bailey talks down the idea of moving rates to negative – short-term bullish reaction in Sterling as traders seemed to flip their focus back to Brexit and pandemic challenges to push the currency lower against the major during the U.S. session.
Boris Johnson says UK is at a ‘perilous turning point’ and tells people to work from home
Wednesday:
UK recovery loses momentum in September and business outlook drops to its weakest since May
U.K. Warns of 7,000-Truck Line in Worst-Case Brexit Scenario
UK confident on overcoming difficulties to get EU deal: Gove
Irish PM says EU-UK trade deal can be reached
EU chief negotiator ‘determined’ to get Brexit deal but will be firm
Thursday:
UK Headline retail sales growth fastest in 18 months, but some sub-sectors continue to struggle
Rishi Sunak unveils emergency jobs scheme – will replace the furlough scheme; workers will get three quarters of their normal salaries for six months.
EU/UK trade deal will fail if divorce treaty threatened, Ireland says
Friday:
UK public borrowing overtakes financial crisis peak
Fitch Affirms the UK at ‘AA-‘; Outlook Negative
UK Consumer Confidence improves two points in September
U.K. Budget Deficit Hits $222 Billion Under Lockdowns
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Bank of England 2020 Q3 Quarterly Bulletin
- Businesses reported that the spread of Covid-19 and the measures to contain it led to a fall in sales of around 30% in 2020 Q2. Sales are expected to recover gradually, but further reductions in employment are expected in the second half of 2020.
- Businesses’ expectations of future sales and employment growth became skewed to the downside. This means that businesses thought that there was an increased risk of bad outcomes occurring.