Pound Weakens, US Dollar Recovers

The British pound sterling (GBP) rates recently fell as the Purchasing Managers Index (PMI) figures fell as well.

Aside from PMI’s short of estimate, unemployment is also one of the top reasons behind GBP’s fall.

Unemployment has been a major problem for most countries during the course of the COVID-19 pandemic. The same situation is present in the Philippines, with a survey conducted by SWS from July 3-6, 2020 showed that adult unemployment in the country spiked-up to 45.5%, compared to 17.1% in December 2019.

27.3 million Filipino adults are estimated to be out of job or looking for a job as of July 2020. For comparison, only 7.9 million were jobless in December 2019.

US Dollar Recovering

US Dollar (USD) however, managed to recover as PMI and positive economic initial jobless data were both impressed. Despite the devastating Eurozone retail sales, the Euro to USD exchange rate also managed to pick up the pace as France came up with a new pandemic recovery plan.

Meanwhile, PMI announced that GBP is doing below expectation triggering concerns on the UK’s job market.

The final figures in August this year showed that the index went down from a preliminary estimate 60.1 to 58.8. However, the index also showed the 34% increase of job cuts in the service industry.

This shows that even the mightiest countries are hit hard by the pandemic. (MLC)