Troubles continue for Pound

16 September, 2020

Rob Bastin

Last week Sterling suffered its worse week since the market crash back in March, as investors becomes increasingly concerned of the prospect of a ‘no deal’ Brexit. So far this week a small technical bounce has been seen however any gains have been very limited. Latest unemployment data for the UK played a part in this yesterday, with the headline rate unsurprisingly increasing from 3.9% to 4.1%, with the claimant count also up to 73.7k and further increasing from the previous month. This is now the highest level of unemployment for 2 years in the UK, with 16-24 year olds suffering the heaviest. These figures are very much expected to increase further as the government wind down their Job retention Scheme ending on October 31st, which has seen nearly 10 million people on furlough pay this year.

Today we will get the latest Inflation figures for the UK, with Consumer price Index expected to come in at 0 for August. The rest of the day will see focus switch to the USD with Retail Sales numbers at 1:30pm and the Fed interest rate decision and policy statement this evening at 7pm.  The rate is expected to be held at 0.25%.

Current market conditions remain very uncertain and very unpredictable. Most of the world has suffered economically from the lockdowns and questions still remain as to whether further lockdowns may be seen again in the coming weeks or months. The UK of course has twice the risk and uncertainty with the Brexit deadline looming and the probabilities of leaving without a deal increasing by the week. If you have a currency requirement before year end, contact your consultant for a friendly chat on how you can best navigate these challenging times.