- Pound (GBP) falls across the week despite strong fundamentals
- Tensions & violence in Northern Ireland unnerving
- Euro (EUR) rises on USD weakness
- German trade balance & industrial production up next
The Pound Euro (GBP/EUR) exchange rate is edging higher after three consecutive losing sessions . The pair settled -0.35% lower on Thursday at €1.1526 around the low of the day and a level last seen 6 weeks ago. At 05:15 UTC, GBP/EUR trades +0.1% at €1.1536. The pair is set to lose around 1.9% so far this week.
The Pound has struggled across the week despite strong fundamentals. Covid numbers continue to decline, falling by a third in a week to 3030. England is set to reopen its economy on Monday with all shops, hairdressers and outside hospitality restarting.
Separately British household spending on credit and debit cards rose to 88% of pre-pandemic levels last week, which was the highest level since just before Christmas. The upbeat data is a sign that the economy is starting to fire up again as covid restrictions start to ease.
Rising tensions on the streets of Northern Ireland could be unnerving Pound traders. Nightly outbreaks of violence fuelled by pro-British unionists over post Brexit trade barriers are escalating, reviving memories of Northern Ireland prior to the 1998 peace deal.
There is no high impacting data due to be released tomorrow, which means that sentiment is likely to be the biggest driving force for the Pound tomorrow.
The Euro has had a stellar week this rising across the board. Yesterday the common currency received a boost from the falling US Dollar. The Euro trades inversely to the greenback.
The minutes from the European Central Bank came with no surprises. The ECB pledged to remain supportive for as long as necessary and added that they saw no risk to the economy overheating.
Investors shrugged off concerns over the AstraZeneca vaccine and links to a rare blood clot in younger people. The EU are particularly dependent on the AstraZeneca vaccine for their already sluggish vaccine rollout.
German trade balance and German industrial production data are the highlights of the Eurozone economic calendar today.