Once again, the pound finds itself in a difficult position, where there are different forces at play attempting to pull it in either direction. Through Asian trading hours, the pound was sold off following a dip in risk sentiment following global equity sell offs. Yesterday saw the Dow Jones Industrial Average’s biggest one day drop since October, which in turn had a knock-on effect to the UK’s FTSE and sterling. On the other hand, however, the UK Government continues to deliver on their vaccine rollout plans. With the global race to unlock the economy, the UK is on course to be one of the first to have the population vaccinated, meaning the pound is being pulled in both directions.
Later today Boris Johnson will travel to a vaccination centre in Aberdeen, which has been labelled as a “charm offensive” following growing support for Scottish independence.
The first Fed meeting of the year took place yesterday in the States. The message from the central bank was as expected, that interest rates and quantitative easing levels would remain the same. The chair, Jerome Powell, then went on to say that the Fed expects more of a recovery following the Covid pandemic heading into the second half of 2021.
Have a great day.
Jack Nicholls, Relationship Manager.
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