The pound vs the US dollar has been trading in a very tight range during today’s trading session as we move towards the end of the trading week. After hitting above 1.25 on the Interbank earlier this week which was the highest we have seen sterling trading vs the US dollar in weeks the GBP has once again started to slowly fall against the US dollar.
Yesterday US jobless claims confirmed another worrying rise in individuals claiming for state aid and the figure is set to keep rising in the near future. However, US President Donald Trump has made claims that he has provided governors across the US some guidance on reopening a number of state’s economies in the upcoming months.
He has also suggested that governors will be able to decide how to manage the easing of the lockdown process along with hope from central government. With over 650,000 cases and over 32,000 deaths at the timing of writing this article Trump has claimed that some states could even open before the end of this month. The news appears to have helped to provide the US dollar with some support against both the pound and vs the euro.
Clearly, Trump wants the economy to start again as quickly as possible as 70% of the US economy comes from consumer spending so without people getting out and about then there will be a continued loss for the world’s biggest economy. Therefore, this is why Trump wants to see citizens retuning to work ‘as conditions’ allow.
I think as we go into next week the market will be waiting to see what happens with a number of different economic data announcements. On Tuesday morning the UK will release its own claimant count for the jobs market so anything dramatically different compared to the expectation could see a lot of volatility for the pound vs the US dollar.
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