The Pound struggled again on Thursday as markets became increasingly worried about the rise in Delta COVID-19 cases here in the UK. Despite fears that the new strain of virus may hold up plans to lift restrictions on 21st June, Boris Johnson remains “upbeat”, claiming he could “see nothing in the data at the moment that means we can’t go ahead with step four, or the opening up on June 21”. The FT reports that “Senior members of Johnson’s government said they expected the prime minister to hold to the June 21 date unless the data present a compelling case for a delay”. Moving forward, if there is any news that will derail the UK’s plans to ‘re-open’, Sterling will depreciate. Equally, if the UK can indeed stick to its planned timeline, there’s a strong chance the Pound could spike.
GBPUSD started Thursday just above the 1.4150 mark at 1.4153. Already weak, Cable depreciated further throughout the day, finally closing off the session at 1.4112. It’s important to note that it was Dollar upside that was the main driver of the pair yesterday.
The Dollar was able to make some subtle gains on Thursday after the release of better-than-expected macroeconomic data. ADP's private-sector Labour market figures exceed expectations by 978K in May, and Unemployment Claims fell below 400K. Also, the ISM Services Purchasing Managers' Index beat estimates with 64 points, showing resilience in America's largest sector.
This boost was also evident in EURUSD as the pair plummeted closer to the 1.2100 handle. The pair opened that day at 1.2196 and closed at 1.2137.
GBPEUR in contrast was able to make modest gains on Thursday – starting at 1.1605 and closing at 1.1627.