The British pound finished the week as a net winner after mixed priced action mostly driven global risk sentiment. It was an optimistic vibe through most of the week until everything turned sour on Thursday thanks to geopolitical headlines and weakening global economic data.
Sterling’s performance was a little surprising given the light economic calendar and new cycle from the UK, which was more negative than positive weak retail sales and credit data, and growing Brexit risk.
United Kingdom Headlines and Economic data
Monday:
U.K.’s Boris Johnson rules out swift end to coronavirus lockdown
We saw a positive lean in global risk sentiment at the beginning of the week as more countries were looking at re-opening their economies. This was a likely contributor to the mixed performance in Sterling (lower against the comdolls, higher against the “safe haven” currencies) through the Thursday session.
Tuesday:
UK retail suffering from collapse in consumer spending, says CBI
UK not ready to change social distancing measures: PM Johnson’s spokesman
UK on track for one of Europe’s worst virus death tolls
Wednesday:
UK retailers cut non-food prices by most on record – BRC
Thursday:
UK warns EU is risking Brexit deal by ignoring its red lines
Sterling rallied against the higher-yielding currencies on Thursday, likely on rising negative risk sentiment starting in the London session on negative economic updates from Europe (GDP down by 3.8% in the euro area and by 3.5% in the EU), negative outlook from the ECB monetary policy statement, and possibly on some negative commentary from two of the largest companies in the world (Amazon and Apple) taking down U.S. equities.
Friday:
UK house prices: Experts predict sharp recovery after coronavirus lockdown
UK factories suffer worst month in three decades: IHS Markit
UK Mortgage approvals for house purchase fell to 56,200, their lowest level since March 2013
Brexit breakthrough slips further out of reach after virus delay
