News that Boris Johnson is stable and not on a ventilator have helped the pound to regain some of the ground it lost early yesterday morning following reports of his admittance to an ICU.
The euro is weaker this morning after EU finance ministers failed to agree on a coordinated response to the coronavirus crisis.
With hints of risk sentiment improving after China claimed its first day without any reported deaths, we have seen the dollar weaken somewhat. However, it’s looking stronger today as coronavirus worries continue.
GBP: Pound recovers against euro on news that PM is stable
The pound faltered slightly yesterday due to news of the Prime Minister being taken into intensive care. However, improved global sentiment and good news about the state of the global financial markets has supported sterling against the euro. This morning, the pound is weaker against the dollar as worries over the health of the Cabinet limits sterling’s gains.
Since the beginning of the day yesterday, there has been positive news that the Prime Minister is in a stable condition and in “good spirits”. In the daily press briefing yesterday, Dominic Raab said that the cabinet is “focused with total unity and resolve” and added that he will deputise for the PM for as long as necessary.
Any further news of the Prime Minister’s health is likely to have an impact on the pound, as well as general coronavirus news. Cabinet Office Minister, Michael Gove, is now self isolating, casting worries over the leadership of the country and the health of the cabinet.
EUR: Euro down after EU fail to reach coordinated response
Euro has started the day down against the pound, after it materialised that EU financial ministers are still divided over a response to the coronavirus crisis. In an emergency teleconference that lasted more than 16 hours, finance chiefs couldn’t agree on the steps needed to help European economies recover.
Countries in the North of Europe are largely in disagreement with those in the South, which have been hit hard by the virus. Another call is scheduled for tomorrow, however, at the moment it’s unclear how members with overcome their differences.
USD: Dollar awaits FOMC minutes
Hopes of progress being made against the coronavirus weighed on the dollar yesterday. The global financial markets started to stabilise again, meaning that the greenback weakened against the euro and dollar. However, the dollar is stronger again this morning as attention once more turns to global economic worries.
Yesterday, China recorded no new deaths for the first time, which is another piece of significant news that will have pushed the dollar lower
FOMC meeting minutes will be released this evening. If these minutes reflect the same urgency and concern as they did back in March, we could see demand for the dollar grow.