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Pound Inches Higher Against Dollar on Positive UK Macro Outlook

February 10, 2021 at 18:03 by Simon Mugo

GBP 50 banknote lying on some GBP 20 banknotesThe Sterling pound inched higher against the dollar fueled by the positive the fast rollout of the coronavirus vaccine in the country as compared to its peers. The GBP/USD currency pair’s rally was also fueled by investor optimism about Britain’s economic recovery since the government might ease restrictions earlier than expected.
The GBP/USD currency pair rallied from a low of 1.3803 in the Asian market to a high of 1.3866 in the American session but was off these highs at the time of writing.

The currency pair inched higher from the start of today’s session buoyed by the rapid pace of the UK’s coronavirus vaccine rollout that has been lauded by experts worldwide. Investors were also hopeful that Rishi Sunak, the UK’s finance minister would extend the fiscal support for employers in the March budget update. The lack of UK macro releases did not help the cable. A speech by Bank of England Governor Andrew Bailey during the American session had a muted impact on the pair. The Governor warned the UK against creating lax financial regulations that could put the country’s economy at risk.

A press briefing by Prime Minister Boris Johnson about the coronavirus vaccine rollout and the timeline on lifting restrictions barely moved the pair. The PM and his Chief Scientific Officer Sir Patrick Vallance pushed for more vaccinations and promised to unveil a new roadmap on February 22.

The currency pair’s future performance is likely to be affected by geopolitical events given tomorrow’s empty UK dockets.

The GBP/USD currency pair was trading at 1.3851 as at 18:02 GMT having rallied from a low of 1.3803. The GBP/JPY currency pair was trading at 144.93, having risen from a low of 144.37.

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