Less Ads, More Data, More Tools Register for FREE

UPDATE 1-Sterling slips against safe-haven dollar

Fri, 22nd May 2020 17:04

* Graphic: World FX rates in 2020 http://tmsnrt.rs/2egbfVh

* Graphic: Trade-weighted sterling since Brexit vote http://tmsnrt.rs/2hwV9Hv

* There will be no sterling market report on Monday May 25
due to
a UK public holiday
(Updates prices)

By Joice Alves

LONDON, May 22 (Reuters) - Sterling edged lower against the
dollar on Friday as tensions between China and the United States
boosted demand for the greenback, but it recovered against the

Tensions between the world's two largest economies
encouraged investors to bet on safe heaven assets and sterling
weakened against a broadly stronger U.S. currency for a third
consecutive day.

The pound was also under pressure after data on Friday
showed that UK retail sales fell by a record 18% in April as the
coronavirus lockdown hit consumer spending.

In addition, Britain's government borrowed more in April
than it has in any month on record, pushing public debt close to
100% of gross domestic product, the highest since 1963, data

The data added pressure on the pound, which has suffered
since the latest round of Brexit negotiations ended with scant
progress last week and on market speculation that the Bank of
England could cut interest rates to negative to spur the

"With the prospects of negative rates fully on the market’s
radar and in part priced in by the end of this year and for
2021, the next main hurdle for GBP should be the negative
news-flow on the trade negotiations and likely no extension of
the UK-EU transition period," strategists at ING wrote in a note
to clients.

The pound was last down 0.4% versus the dollar at $1.2174
and up 0.16% against the euro at 89.48 pence
, recovering after three consecutive days of losses
against the euro zone currency.

Dollar strength caused the euro to retreat from the key
$1.10 level hit on Thursday, in the absence of further news
about the EU recovery fund which boosted the euro when it was
announced earlier in the week.

A drop in UK inflation fuelled speculation this week that
the Bank of England might cut interest rates below
zero. British five-year government bond yields fell
below zero for the first time on Thursday, a day after Britain
sold its first bond with a negative yield.

The pound is in the lower band of its recent trading range,
as Britain remains one of the countries hit hardest by the
pandemic. The UK’s death toll from COVID-19, the disease caused
by the new coronavirus, has topped 43,000, the worst in Europe.

Britain's finance ministry said more than 1.8 million
mortgage payment holidays had been taken up since March. The
scheme had been due to end in June but was extended for another
three months.
(Editing by Larry King and Susan Fenton)

More News

HSBC warns it could face reprisals in China if UK bans Huawei equipment -the Telegraph

June 6 (Reuters) - HSBC Holdings Plc Chairman Mark Tucker has warned Britain against a ban on networking equipment made by Huawei Technologies Co Ltd, claiming the bank could face reprisals in China, the Telegraph reported on Saturday.Tucker made ...

6 Jun 20 23:05

UK's Johnson eyes relaxation of COVID lockdown, extra spending

LONDON, June 6 (Reuters) - British Prime Minister Boris Johnson is planning to relax rules on outdoor dining and weddings, as well as speeding up government investment plans in a bid to limit the economic damage from the coronavirus, newspapers r...

6 Jun 20 22:39

Britain's Banksy depicts U.S. flag on fire in Floyd tribute

LONDON, June 6 (Reuters) - Reclusive British street artist Banksy published a new artwork online on Saturday which depicts the United States flag being set alight by a candle that forms part of a memorial to an anonymous, black, silhouetted figure...

6 Jun 20 17:04

Sunday Trading Laws Could Be Relaxed In UK To Stimulate Economy

Sunday Trading Laws Could Be Relaxed In UK To Stimulate Economy

6 Jun 20 11:20

Login to your account

Don't have an account? Click here to register.