After a bit of a roller-coaster ride to end the week, the pound seems to have settled to stop further losses. Still sitting below 1.40 against the US dollar, significant upside momentum will need to be found to push it back above that mark. Currently around 70 pips below 1.40 at the time of writing, making the total loss of 2.15% away from the Wednesday high of 1.4244. GBPEUR continues to tread water above 1.15 as the pound has managed to claw back more of those losses, compared to the dollar, from last week.
Over the weekend the US House of Representatives passed the next big Covid relief package, totalling $1.9tn. The next hurdle for the package will be to pass through the Senate before being rolled out. This favours riskier assets, such as the pound and oil dependant currencies.
The week ahead is looking busy on the economic calendar. The big release from today will be PMI data from the US, which shows business conditions across the country. Better than expected US data releases were what saw the pound tumble in the second half of last week, as markets started to rumour the scaling back of Fed stimulus plans which have helped keep markets afloat through the pandemic.
The UK Government announced over the weekend that 20 million citizens have now had their first Covid vaccine. Keeping up the promised pace, it looks as though the pledge to have every adult vaccinated by the end of July will be met.
Have a great day.
Jack Nicholls, Relationship Manager.
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