DAILY MARKET NEWS: Grim Economic Outlook Causes the Pound to Drop
Tuesday was not one of the best days for the Pound as the currency experienced a sharp fall. This came after the Bank of England chief economist Andy Haldane commented on how GDP is likely to shrink during the first quarter and that it is likely to be a slow process of rebounding once the pandemic has passed. Along with this, he also claimed that consumers might not want to spend as vigorously as they did before the pandemic once the lockdown is relaxed. As a result, the Foreign Exchange rate indicated that the pound weakened against the Euro and the Dollar finishing the day at 1.1330 and 1.2296 respectively.
The Euro was given a lift during Tuesday against both the pound and the dollar. This came as a result of the unexpected Eurozone and German sentiment figures shot up to positive numbers. Germany saw the biggest upswing since records were taken and this could indicate that investors are beginning to see an end to the current situation.
The US Dollar also gathered some momentum yesterday as investors sought safety with the currency after US oil prices collapsed, all of which caused a certain level of uncertainty in local and international payments.