Pound Higher as Vaccination Roll-Out Continues

UK's vaccine campaign gaining momentum; USD likely to remain weighed by new policies.

GBPIn London trading, the British pound struck a 2½ year peak versus the US dollar, as well as an 8-month peak against the euro. Analysts say that investor hopes have driven the pound higher, largely on expectations that the government's rapid-fire efforts to ensure full vaccination of its citizens will result in a quicker rebound of the country's economic growth. The British government is moving at a faster pace than many of its European rivals, leading to the belief that, as a whole, Britain will be able to put the worry of the coronavirus to bed before its neighbors. The pound is also supported by the absence of concern for a negative rate environment; members of the Bank of England's governing council recently dismissed that concept, at least for the next several months.

In London, as of 10:57 am, the GBP/USD was trading at $1.3727, a gain of 0.5273% and sliding away from the session peak of $1.37465, while the low was recorded at $1.36471. The EUR/GBP was lower at 0.8840 pence, down 0.2842%; the pair has ranged from 0.88292 pence to 0.88743 pence in this session. The GBP/JPY was higher at 141.988 yen, a gain of 0.4165%, off the session peak of 142.214 yen.

Dollar Likely to Remain Weighed by New Policy

In the US, the greenback is being weighed by expectations of a near-immediate move by the new Biden administration to enact a major stimulus program for struggling industries and citizens. Yesterday, Joe Biden and Kamala Harris were sworn in as the president and vice-president in a more demure ceremony than normal, given the still raging pandemic. A continuing ultra-loose monetary policy, coupled with a massive injection of cash through fiscal policy, is likely to keep the US dollar weighed for many months to come, says currency strategists. The EUR/USD was trading higher at $1.2139, a gain of 0.2436%, while the USD/JPY was lower at 103.4200 yen.

Barbara Zigah

After working on Wall Street, Barb began her second career as a freelance writer at Daily Forex, where the CEO recognized fresh, untapped potential and was willing to give her a try. She’s never looked back. Since then, she’s worked steadily as a freelance writer and editor in the financial services and Forex-related industry.

Did you like what you read? Let us know what you think!

exclamation mark

Please make sure your comments are appropriate and that they do not promote services or products, political parties, campaign material or ballot propositions. Comments that contain abusive, vulgar, offensive, threatening or harassing language, or personal attacks of any kind will be deleted. Comments including inappropriate will also be removed.

0 User comments

exclamation mark

Please make sure your comments are appropriate and that they do not promote services or products, political parties, campaign material or ballot propositions. Comments that contain abusive, vulgar, offensive, threatening or harassing language, or personal attacks of any kind will be deleted. Comments including inappropriate will also be removed.

Read more
Add new comment
This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.