The Pound suffers more significant declines

Hi everyone,

The fresh meltdown in global stock markets, have caused Sterling to crash heavily again. The Pound had already been trading around 5-month lows against its two main rivals the Euro & US Dollar. Should global markets stabilise, the Pound will show some recovery, but it would be limited and we therefore expect levels to remain where they are.

Currently, nothing else matters to the market (including Brexit) apart from the coronavirus and the damage it is and will be causing the global economy. The Pound is prone to fall when there is a stock market sell-off and this is due a number of factors such as; foreign capital leaving the country, the UK imports more than it exports and the £ not being a safe-haven currency.

Elsewhere, the ECB kept interest rates unchanged yesterday which was no real surprise, as they already have a negative rate of -0.5% and so not much room to further lower rates. The single-currency will continue to perform well as long as stocks remain low, but Italy's economy may well be asking for a bailout soon which will instantly weaken it. 

It is expected Sterling will recover ONLY when a corner has been turned in the coronavirus outbreak, which may be some distance away.  



A quick message from our CEO Karl Daly;

"We would like to reassure customers that our service to you will be ongoing throughout the coronavirus disruption. Our own banking and service providers have the necessary procedures in place to ensure we can carry on trading during the uncertain weeks/months ahead. In the event we may need to work from home, all staff members will have access to the systems required, to ensure there is no impact to communication, response times or payment cycles."
 

 

Dan Waterman
Sales Director

 
 
 


 

 
 
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