- Pound (GBP) boosted by economic recovery prospects
- CPI data due on Wednesday
- Euro (EUR) under pressure amid slower vaccine rollout
- German ZEW economic sentiment data in focus
The Pound Euro (GBP/EUR) exchange rate is extending gains for a third straight day. The pair settled +0.15% on Monday at €1.1460, towards the high of the day. At 05:15 UTC, GBP/EUR trades +0.2% at €1.1480 a fresh 9 month high.
The Pound powered ahead across the board at the start of the week, boosted by the strong covid vaccine programme and the falling new daily cases. Ultimately the improving covid picture means that the UK moves closer to easing lockdown restrictions.
Data also revealed that the number of people heading out to the shops in the UK increased by 1.5% last week compared to the previous week. This marked the fourth straight week of rises, an indication that Britons were tiring of the lockdown conditions.
On 22nd February Prime Minister Boris Johnson is due to announce the path out of lockdown. This will determine how quickly the UK economy will fire back up.
There is no high impacting UK data due to be released today. Investors will look ahead to UK inflation data on Wednesday.
The Euro came under pressure in the previous session amid a slower vaccoine rollout programme. Furthermore, the President of the Eurogroup, Paschal Donohoe, said that supportive economic policies should remain in place in Europe as long as needed.
After a quiet start on the economic calendar this week, things start to pick up today with the release of the fourth quarter GDP – although this is the second reading so is unlikely to have as big an impact as the preliminary reading unless is falls a significant distance from the first print.
German ZEW economic sentiment data for February will be under the spotlight and is expected to continue to deteriorate amid ongoing lockdown conditions and a slow vaccine rollout.