An improvement in investor risk sentiment helped to push the Pound Sterling higher against its main rivals, the US Dollar and the Euro. Market focus is primarily on two key central names, namely the Federal Reserve Bank, with a policy meeting set for Wednesday, and the European Central Bank, which will meet on Thursday. Analysts expect that both banks will follow the direction of the Bank of Japan which expanded its stimulus efforts at its policy meeting on Monday. Currency strategists expect that FX traders will soon be moving to limit their exposure in risk-off trades.
As of 11:10 am in London trading, the EUR/GBP was trading at 0.8708 Pence, a loss of 0.0356% and off the session trough of 0.86887 Pence. The GBP/USD was higher at $1.2845, up 0.4797%; the pair has ranged from a low of $1.24036 to a peak of $1.25059 in this trading day. The GBP/JPY was down at 133.207 Yen, a loss of 0.0473% and off the session trough of 132.985 Yen.
Riksbank Maintains Current Strategy
The Swedish central bank issued its policy decision earlier today. While the Riksbank's policy committee maintained interest rates at current levels, and left unchanged its current measures to provide stimulus in the face of the Coronavirus fallout, the central bank said it was ready to act more aggressively if the situation warranted. The argument that the Riksbank has held is that they wish to focus primarily on credit supply. But some analysts wonder if they missed an opportunity to cut rates at this point, and if not now, then when? The USD/SEK is currently trading lower at 9.8997 Swedish Krona, down 1.0641%, while the EUR/SEK is at 10.7646 Swedish Krona, a loss of 0.6656%.