As trading got underway on Tuesday the Pound trended lower as concerns around Brexit left investors feeling slightly nervous. Despite this, as the day progressed, it became clear that a Brexit deal was getting closer and so, the currency rebounded. However, the Pound to US Dollar rate dropped to 1.2876 while the Euro rate also dropped to 1.0974 according to the Foreign Exchange Market. As Brexit concerns and coronavirus cases increase, the currency is likely to be met with some headwinds during trading today.
There was very little direction for the Euro on Tuesday as the European Central Bank continued to mount misery on the single currency. Concerned about the economic recovery, a warning was made that suggested that a V-shape recovery was unlikely although it could be a case that more monetary stimulus is required. This downbeat announcement wasn’t even offset by news that Germany had seen a better-than-expected increase in factory order growth during August.
Trump made a call for all stimulus talks to be halted immediately and that saw the US Dollar climb, as a market sell-off took place which meant investors took comfort in the safe-haven currency. As a result, gains were made against the Pound and the Euro.