- Calls For Dominique Cummings Resignation
- French Government Cancels €3 Billion Stimulus Package
- Focus On German GDP
EUR/GBP is struggling for direction in early Monday trading session as a wave of negative news continues to hurt British Pound and Euro sentiments in the market. After rallying over the past few weeks, the pair tumbled in late Friday trading session, as weakness in the Euro sent the pair low.
Sterling pound Weakness
The pair came under pressure late last week as weak economic data continued to raise serious concerns about the European Union economy. PMI data dropping to record lows amidst poor retail sales all but continued to hurt Euro sentiments in the market.
While the pair looked set to start the week on a back foot, weakness in the British Pound has averted further movements on the downside. The Sterling pound is on the defensive in early Monday trading session as British Prime Minister Boris Johnson party members push for the resignation of influential aid Dominic Cummings.
Cummings is the subject of immense outrage over claims he traveled to Northern England from London even as the U.K was under lockdown to curb the spread of the Coronavirus. Prime Minister is trying to hold on to his most trusted aide despite ferocious calls for his resignation from party members.
However, weakness in the EUR continues to offset weakness in the pound as well. The single currency is the subject of soaring bearish pressure in the wake of weak economic data at the back of the COVID-19 fallout.
The French government confirming it will cancel three billion worth of euros that was to be used to revitalize embattled restaurant tourism and sport sectors is all but taking a toll on EUR sentiment in the market. The pushback raises serious concerns as to when the European economy will recover following the COVID-19 pandemic, something that continues to fuel weakness on the single currency.
Looking ahead, German Quarter-over-Quarter GDP data has the potential to influence EUR strength conversely influence EUR/GBP direction of trade. The market expects a -2.2% contraction compared to 0.4% in the previous quarter. The market also awaits the German IFO business Climate Index.