All eyes were on GBPEUR yesterday as for the first time since April last year, the pair soared past the 1.15 handle. The main driver of this move was better than expected Inflation data from the UK early in the morning, coming out at 0.7% as opposed to analysts’ expectations of 0.6%. Core Inflation for January also rose to 1.4%, against a forecast of 1.3%. Cable in contrast printed a fresh three-day low during the American session yesterday because of a stronger Dollar. GBPUSD fell as far as 1.3828 but was able to retrieve some of those losses before the close. The boost to the Dollar came in the afternoon when January Retail Sales smashed expectations by coming in at 5.3% as opposed to the forecasted 1.1%.
Despite some data-induced volatility, Cable remains firm going into the latter half of the week. GBPUSD opened Wednesday at 1.3886 and closed at 1.3847.
GBPEUR started the session at 1.1499 and quickly made itself comfortable in the 1.15 range. As positive UK data kept Sterling resilient, the pair was able to finish the day well supported at 1.1500.
Wednesday proved to be yet another lacklustre day for EURUSD. The pair opened at 1.2076 and quickly dropped into the lower ranges of 1.20 and was unable to gain any upside traction. The pair managed to claw back some of its losses however, ending the day at 1.2041.
In regard to the UK’s battle against COVID-19, Prime Minister Boris Johnson said yesterday he would set out “what we can” in a road map for easing restrictions this coming Monday. He reiterated that it is “absolutely right” that the government takes a “data not dates” approach to easing lockdown restrictions. He stressed that government intends to lift measures “cautiously” to ensure the safety of the nation. While a total of 15,940,972 people have now received the first dose of a vaccine, official figures show the UK has recorded a further 12,718 COVID-19 cases and another 738 deaths within 28 days of a positive test.