- Pound (GBP) soars supported by vaccine drive
- UK manufacturing PMI in focus
- Euro (EUR) under pressure as vaccine rollout comparatively slow
- EZ manufacturing PMI expected to show strong expansion
The Pound Euro (GBP/EUR) exchange rate is surging higher on Monday paring losses from the end of last week . The pair settled -0.25% lower on Friday at €1.1287 however the pair still managed to trend 0.4% higher across the week as a whole. At 05:15 UTC, EUR/GBP trades +0.3% at €1.1330.
The Pound capitalized on the fall of the common currency across most of last week. Investors also found the Pound appealing thanks to the speed of the vaccine rollout in the UK and despite the current ongoing UK lockdown.
Data from Israel where the vaccine rollout has been extraordinarily quick is showing very encouraging results with the number of new covid cases dropping fast. If the UK could mirror such results in the coming months’ then the economy could be on track for a solid recovery this year.
On Saturday just shy of 600,000 covid injections were given, and the total number of people with their first injection stands at just short of 9 million.
On the economic calendar UK manufacturing PMI data for January will be released. This is the final reading and so isn’t expected to move the market much. Analysts are expecting a confirmation of the 52.9 reading from earlier in the month.
Later this week the Bank of England is due to announce its monetary policy decision. The central bank is not expected to make any changes to policy.
Comparatively speaking the Euro’s vaccination programme is significantly slower after late approval and production and supply problems in some areas.
The mood towards the Euro could pick up if upcoming data from the Eurozone shows economic resilience.
Today will see the release of Eurozone manufacturing PMI data for January which is expected to show that the sector expanded solidly last month at 55.5, up from 54.7. The level 50 separates expansion from contraction.
Unemployment numbers for December are expected to remain steady at 8.3%.