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Safe haven flows with coronavirus outbreak in focus

24th January 2020 Market Update

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🇬🇧 GBP – Sterling moves were muted yesterday in the absence of any data as the market looks to the Bank of England on Thursday.
Current expectations are for the Bank of England to keep rates at 0.75%, although market odds place a rate cut at 53%. One of the other key factors to look out for on Thursday will be how members of the BoE vote with regards to a rate cut. In the last meeting we had two members vote for a rate cut and on Thursday’s meeting, the market expects an additional member to vote for a rate cut also.

The only notable piece of data is the CBI survey on retails sales due out this morning.

🇪🇺 EUR – The euro continued its losing run since last Thursday’s ECB meeting following the latest IFO business climate survey from Germany falling short of what the market was expecting.

No data is expected today

🇺🇸 USD – The dollar seems to be benefitting from safe-haven flows as the Coronavirus outbreak continues to make headlines across the world. The US dollar now sits at its strongest level since 1st December.

In focus today will be durable goods orders figures for the month of December with expectations that sales will rise to 0.5% following a fall of 2.1% in November.

 

Summary:

GBP: Sterling moves muted ahead of Super Thursday
EUR: German business survey adds to the woes of the Euro
USD: Dollar benefits due to safe-haven flows

 

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Darren Kilner

Darren Kilner

Darren is Head of Dealing at FairFX. Darren lives and breaths FX, his Mastermind topics are G8 currencies and economic forecasts.

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