- Posted by currencies in coronavirus, Currency, Dollar, Economy, EUR, Fed, GBP, Sterling, UK, Uncategorised
- March 25, 2020
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Sterling recovered ground against USD yesterday increasing by just under 2% to trade at 1.1889. This improvement in fortunes was owed to a very positive release for UK Manufacturing in March. Expectations suggest PMI data for April will disappoint further seeing as these figures contributed to activity before the UK went into lockdown.
UK inflation for February slipped off a 6-month high mainly down to a drop in fuel prices which occurred just before The Coronavirus hit the UK. Moving forward, employment data will provide a real insight into how The UK is dealing with this pandemic. Any rise in unemployment and jobless claims could be damaging for the economy once this passes.
On Tuesday evening, The U.S Senate were negotiating a $2 trillion emergency bill armed with the task of countering the economic toll of The Coronavirus. This involved $500b broken down into two payments of $1,200 to any individual earning $75,000 per year, rising to $3,000 for a family of four. Funds have also been made available for the airline industry, small business and hospitals.
The Euro-Zone is now extremely close to heading into a recession due to the damaging effect of the Coronavirus. PMI data yesterday morning showed just how bad the situation is at present, with analysts suggesting this recession could be the biggest ever recorded. This led to The Euro-Zone following in the footsteps of The Fed through an injection of €750 billion emergency bill.