IFX Market Report: Wednesday 24th March 2021

The Pound struggled on the Tuesday as Cable dropped over 0.7% by mid-morning in the London session, and GBPEUR was also lower, trading just above the 1.16 mark at the close. Rise in COVID-19 infections and fears of a possible vaccine shortage are the main catalysts of Sterling’s downfall. President of the EU Commission Ursula von der Leyen controversially said recently that the EU may “forbid planned exports” of the Oxford-AstraZeneca vaccine to the UK. Boris Johnson has said that he “talked to EU friends repeatedly" of late and has been "reassured... over the last few month they don't want to see blockades". Nonetheless, this news has stunted the markets hopes of the UK sticking to the government’s roadmap, naturally harming the Pound.

GBPUSD started the session relatively well supported at 1.3840 but quickly came under significant selling-pressure and depreciated rapidly. Cable finally ended the day at 1.3791 and continued to fall.

GBPEUR opened the day at 1.1603 and struggled to gain any momentum in the session. The pair finally closed at 1.1617 and fell into the 1.15’s later in the evening.

EURUSD also made a loss on Tuesday. The pair opened at 1.1927 and closed at 1.1872.

On the data front, it is another important day for the UK with Core Inflation Rate released at 07:00. The Core Rate is forecasted to come in at 1.4%, while the MoM figure is expected at 0.5%. At 08:00 the ECB have their Non-Monetary Policy meeting. Then from 8:30 onwards are PMI releases from Germany, Eurozone, UK and the U.S. In the afternoon at 14:00 Fed Chair Jerome Powell will be giving a testimony.

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