- Pound (GBP) extends gains on vaccine programme acceleration reports
- UK GDP MoM November -5.7% expected
- ECB minutes drag on Euro (EUR)
- EZ trade balance up next.
The Pound Euro (GBP/EUR) exchange rate is advancing for a seventh consecutive session. The pair settled +0.4% at €1.1256 after hitting a fresh 2 month high of €1.1279 earlier in the session. At 05:15 UTC, GBP/EUR trades +0.05% at €1.1261.
The Pound has surged across the week, supported buy fading speculation of negative interest rates and buoyed by vaccine optimism as the covid jab is rolled out.
Whilst covid cases remain elevated there are signs that numbers of new daily cases are falling. So much so, in fact that Prime Minister Boris Johnson has decided not to tighten lockdown restrictions again, at least for now.
Britain is reportedly set to accelerate its covid vaccination programme with 500,000 doses a day from next week. The British government aims to vaccinate 15 million vulnerable people by mid February. The vaccine is the surest and quickest way for the UK economy to reopen. The longer it takes, the more damage inflicted on the economy.
A slew of data due for release today will shed some insight into the health of the UK economy. UK GDP will be the most closely eyed statistic. Analysts forecast -5.7% contraction in the month of the second national lockdown, down from +0.4% growth the previous month as -12.1% contraction year on year.
The Euro came under pressure in the previous session following the release of the minutes from the December European Central Bank meeting. At the meeting the ECB increased and extended monetary policy accommodation until March 2022. The minutes revealed that the central bank policy members were supportive of the measures but that there were also concerns over the exchange rate level and lacklustre inflation in the block.
Looking ahead Eurozone trade balance will be in focus on the economic calendar, in addition to French and Spanish consumer inflation figures.