The Sterling pound today fell against the much stronger US dollar amid fears that the global economy was sliding into a significant recession due to the coronavirus pandemic. The GBP/USD currency pair recouped some of its losses in the American session as the greenback gave up some of its gains, allowing riskier currencies to post gains.
The GBP/USD currency pair today fell to a low of 1.2435 having opened the day’s session trading at an initial high of 1.2624, but had recovered from its daily lows at the time of writing.
The currency pair’s decline today was attributed to a technical pullback from its 100-day exponential moving average as bulls took profits garnered from the cable’s 7-day rally. The rising coronavirus cases in the UK also contributed to the pair’s decline as the country seems to be far from flattening the COVID-19 curve, unlike other European countries. Investors were also worried that the global economy is heading for a significant recession based on a statement released by the International Monetary Fund (IMF) on Tuesday. The news that the EU and UK would resume post-Brexit trade talks next week boosted the pair.
The weak US retail sales data for March released by the Census Bureau also boosted the pair as the greenback headed lower in the American session. The US Dollar Index fell from its daily highs of 99.98 later in the session as the cable rallied.
The cable’s future performance is likely to be affected by geopolitical events and tomorrow’s US jobless claims data.
The GBP/USD currency pair was trading at 1.2531 as at 20:13 GMT, having fallen from a high of 1.2624. The GBP/JPY currency pair was trading at 134.76, having dropped from a high of 135.28.
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