- GBP rallies after Boris Johnson clarifies UK lockdown easing timetable
- Safe haven USD declines as Novavax moves vaccine to human trials
- US consumer confidence expected to tick higher to 88 in May.
- At 07:00 UTC, GBP/USD is +0.25% at US$1.2216 >> Real time exchange rate
The Pound versus the US Dollar is advancing for a third consecutive session on Tuesday. The Pound US Dollar exchange rate settled +0.05% at US$1.2190 in the previous session.
At 07:00 UTC, GBP/USD is trading + 0.25% sat US$1.2216. This is at the top end of the daily traded range amid risk on trading as investors return from the long weekend and as they look ahead to the release of US consumer confidence data.
Clarity from UK Prime Minister Boris Johnson over the timetable for easing lock down restrictions has boosted sentiment in early trade. Boris Johnson announced the reopening of local markets and car dealerships from next week and the reopening of all shops from 15th June, as long as they comply with government rules to restrict the spread of the virus. This is good news for the UK economy and therefore good news for the Pound.
There is no high impacting UK data due today and the economic calendar is quiet across the week, leaving investors to focus on coronavirus and Brexit.
Brexit headlines could limit any gains in the Pound. A hard Brexit remains a possibility as no Brexit trade deal is agreed. Requests to extend the transition period must be made before the end of June. So far, Boris Johnson has shown no interest in extending the transition period, despite mounting calls to do so after Brexit trade talks have been delayed owing to coronavirus crisis.
The safe haven US Dollar is inching lower back across the board amid growing optimism surrounding the global recovery following the coronavirus crisis and on vaccine hopes. Countries across the globe are easing lockdown measures and reopening their economies, whilst US firm Novavax is the latest company to say that it is advancing its vaccine to human trials.
Investors will now look ahead to the release of US consumer confidence data. Analysts are predicting a pickup in morale from April’s six year low. However, with jobless claims showing that close to 25% of the American working population signed up for unemployment benefits, the rebound in confidence could be slow. Analysts are predicting consumer confidence will climb to 88 this month up from 86.9 in April.