A Sterling end to the week

Good morning,

Yesterday, the Bank of England confirmed not only that rates were unanimously staying at 0.10%, but also that they expect the UK economy to “recover rapidly” in 2021. Most of the praise and positive sentiment was based around the speed and scope of the UK’s vaccine programme – with the rapid return to normal life and an unrestricted economy being paramount to the pound’s chances for the year. The conversation surrounding negative interest rates was once again kicked into the long grass allowing GBP/EUR to rocket past the 1.1400 mark and hold there this morning.

Whilst the expectation is that unemployment will sadly rise across 2021, the Government’s furlough scheme has sheltered most of the economy from more catastrophic jobless numbers as seen in the USA – who’s employment figures are due to release at 14.30 GMT today. The belief is that the numbers maybe rebound to positive this time, in comparison to the 140,000 losses seen last month; any deviation either side will likely cause USD volatility.

Have a great weekend.

Joshua Haden-Jones, Senior Relationship Manager.

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