It’s as if it never went away, and in fairness, Brexit has always been lurking in the background. It’s back at the centre though, with further negotiations in Brussels this week. Positive developments are needed if the pound is to have a joyous week, with the government kicking off Monday with travel and immigration details to get the ball rolling.
Home Secretary Priti Patel will be setting out its future border policies today, publishing a 130-page document on how the new points-based immigration system will work. Many eyes will be looking at how the process will work for foreign health professionals, critical to the NHS and the care sector, both at the very heart of the coronavirus recovery, and in turn, in the public’s hearts. A new website entitled ‘Check, Change, Go’, the power of three is once again being used to launch a public information campaign, with Cabinet Office Minister Michael Gove leading the charge on how individuals and businesses can prepare for changes.
Sterling has trimmed down its gains slightly from last week ahead of the Bank of England’s Governor Andrew Bailey speaking later on today. Taking part in a webinar late afternoon, the BoE is still touting the V-shaped recovery, and while some think this is overly optimistic, many see the strong rebounds in economic data coming through thick and fast, and believe the Bank is right. Only time will tell. Analysts also expect the FTSE-100 to jump after Bailey’s speech, coupled with the improving picture that a Covid-19 vaccine, may, be on its way.
US pharmaceuticals giant Gilead has said its Remdesivir treatment showed a 62% cut in fatalities. With antiviral drug trials also underway in China and Australia, the dollar’s safe-haven appeal appears to have dulled. Despite US President Donald Trump wearing a mask in public for the first time, and positive expectations of the upcoming US earnings report, risk-on sentiment is emerging.
Markets are also eyeing The World Health Organisation (WHO) daily numbers, with a fair portion of the daily increases coming from the Americas side of the pond. The US and Brazil have seen large increases, with Florida alone reporting 15,000 new coronavirus cases in a single day, a record single-day total, and a record nobody wanted to win.
Not to be in outdone by domestic US news, Victor Gao from the China National Association of International Studies stated that the US needs to come to terms with the reality that China will become larger than the US, and its growth cannot be stopped. En route to Florida, Trump has said he isn’t even focused on phase two of the trade deal, adding that the US-China relationship is ‘severely damaged’ by the coronavirus pandemic. Reporters travelling with the president claim he is still blaming China for the outbreak.
In other news
Various parts of the UK are unwinding more coronavirus lockdown restrictions from today. You can finally get a wax, manicure, or a tattoo in England, while in Scotland indoor shopping centres are reopening, with face masks mandatory. Wales sees hairdressers back open from today, along with pubs, bars and restaurants, who can serve customers outdoors. However, despite efforts to get businesses back open and running, a poll by the Office for National Statistics revealed more than half of the public are still uncomfortable about eating indoors at a restaurant.
The US and Brazil weren’t the only ones seeing coronavirus daily increases – India and South Africa have seen large outbreaks of Covid-19 in recent days as well. South Africa has once again banned alcohol in an effort to curb the virus, with consumer confidence at a 30-year low in the second quarter. Several Indian states are also re-imposing lockdowns, despite the obvious economic costs.
Ending on a positive note, Canada posted better-than-expected job stats just before the weekend, albeit the Loonie moved little as a reaction. 952,900 people returned to work last month, but analysts are looking ahead and thinking that might be the best jobs data, and are therefore preparing themselves for lacklustre results in the coming months. Despite new lockdowns, the Australian dollar had a steady start, with high iron ore prices providing light relief.