DAILY MARKET NEWS: Better News for the UK Economy Helps Pound Make Some Ground
As Wednesday came to a close, the Pound made some slow gains and much of this was in response to the fact that the GDP figures came in slightly better than expected. The UK economy contracted by 2% which is the biggest since the financial crisis but they were expecting a contraction of 2.5% and this helped to give the Pound some buoyancy. As a result, the foreign exchange rate indicates that the pound ended the day at 1.1308 against the Euro and 1.2232 against the US Dollar.
The Euro had a slightly better day on Wednesday as there is a belief that the economy might have reached its lowest point and so, a recovery could be imminent. However, this is not likely to happen until next year at a minimum. Today, investors are going to have an interest in the European Central Bank’s economic bulletin as it might provide some vital insights.
The US economy has suffered significantly throughout the pandemic and that has seen international payments slow down and the US Dollar struggle. Yesterday was no different as there was not much movement as the US Dollar dipped after warnings of a prolonged recession, although it did pick up after it was announced that negative interest rates are unlikely.