PM Addresses The Nation

In the face of the escalating COVID-19 pandemic which is creating devastation around the globe, the British government reluctantly joined the growing number of countries enforcing lockdowns last night. In a televised address, the British PM Boris Johnson announced a new set of security measures designed to “protect the NHS” and “the British people”.

The UK has come under a great deal of scrutiny over its handling of the virus. With other countries such as Italy, France and Spain quickly moving into a state of lockdown to help combat the spread of the virus. However, the UK had so far refrained from introducing such measures. Over recent days, however, as the weather improves in the UK, images of busy parks, beaches and markets have invited public outrage and increased the pressure on the PM to do more.

Speaking last night, the UK PM detailed the new measures which take effect today. People will now only be allowed to leave their homes for the following reasons:

  • Basic food shopping for necessities such as food and medicine only. All non-essential shops have been closed. Shoppers are advised to make trips as infrequently as possible.
  • One form of exercise per day will be permitted either alone or with one other member of your household
  • Any medical requirement such as to provide or receive care. This will include moving children under age 18 between parents’ homes. Key workers or those with children identified as vulnerable can continue to take their children to school
  • Travelling to and from work is allowed where absolutely necessary, but if possible all work should be done at home.

Johnson described the situation as a “moment of national emergency” and pleaded with people to stay 6ft apart when in public. The PM also outlined that all social events will now be cancelled, including weddings, baptism and attending places of worship. However, funerals will still be permitted though can only be attended by a handful of the closest relatives.

In terms of business closures, the PM announced that the following businesses will be allowed to remain open:

  • Restaurants and cafes for takeaway/delivery only (however, many have chosen to close due to the reduced level of custom and to help protect against the virus)
  • Supermarkets and corner-shops, newsagents, post-offices
  • Petrol stations, garages
  • Hardware stores
  • Laundrettes and dry cleaners
  • Pet shops
  • Banks

Others such as libraries, gyms, non-essential shops, playgrounds and recreational spaces will be closed. Parks will remain open though for exercise only and police will be on patrol to enforce these terms and to disperse groups.

Positive Response

The response to Johnson’s announcement has been broadly positive with politicians across the divide in the UK, including Jeremy Corbyn, supporting the PM’s decision. The question now, will be whether the PM is forced to take further steps in coming days or whether these measures will prove to be enough. In terms of market response, the British Pound has been better supported today on the back of Johnson’s address.

Technical Views

EURGBP (Bullish above .9097)

From a technical viewpoint. EURGBP has tested the 2017/2019 highs of .9311, piercing above the level slightly before reversing. While indicators remain firmly bullish here, a further recovery in GBP could pull EURGBP lower from here. The yearly R1 at .9097 will be the first key downside level to monitor.

Boris Johnson Announces UK Lockdown

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