GBP/USD has been recovering amid a better market mood and despite the UK’s lockdown. Forward-looking PMIs on both sides of the Atlantic and coronavirus headlines are eyed, FXStreet’s analyst Yohay Elam briefs.
Key quotes
“The shuttering of most of the UK economy for at least three weeks had already been priced into the pound and had little impact.”
“The news from Italy is one of the reasons markets are rising and in turn, the dollar is falling. GBP/USD is moving higher also due to the Federal Reserve’s massive Quantitative Easing program – an open-ended one.”
“The upbeat mood comes despite devastating Purchasing Managers’ Indexes from the UK. Markit’s preliminary figures for March have shown sharp contraction in the services sector, where the score plummeted to 35.7 points. The composite figure also hit the worst ever, below the trough of the financial crisis.”
“PMI data is also due out in the US, and they are also set to collapse. ISM’s figures carry more weight than Markit’s in the US, the early publication will likely have an impact.”
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