12th April - Weekly FX Update

Updated: 3 days ago

GBP/EUR

Monday 9AM 12th April: 1.15623

The GBPEUR rate saw an extremely sharp drop last week, starting out Monday at 1.18017, the rate bounced off of support at 1.15, dropping to a low of 1.15020. The rate had previously reached a high in anticipation of lockdown measures being reduced, and the possibility of a restriction-free Britain becoming more promising. However, after Boris Johnson refused to compromise on travel plans for the year, investors quickly lost interest in the Pound. The Pounds target of reaching 1.20 has certainly stalled, and it should look to establish some support. Europe have gained some momentum in closing the gap with the UK in their bid to achieve similar vaccination figures. Moreover, the European Central Bank increased hope in the Euro by delaying stimulus packages, giving the Euro some much-needed strength after the Pounds dominance over the last few weeks. Heading into this week, GDP figures released on Tuesday will set the tone for trading. Vaccination rates will also continue to impact the exchange rate as the UK and Europe compete to immunise its population first.


GBP/USD

Monday 9AM 12th April: 1.37419

The GBPUSD took a tumble last week. Concerns over the way Britain are handling its foreign travel prompted investors to sell its long positions. On top of this, the government announced that under 30's will be offered a different version of the AstraZeneca vaccine, which could halt the UK's programme and potentially delay the roadmap. There was some optimism for the Pound last week, as IMF growth forecasts expect the UK economy to grow by more than 5% in 2021 and 2022, where previously these figures were predicted to be below 1%. Looking ahead to this week, employment data will be at the forefront of U.S. news, positive sentiment could propel the Dollar forward even more. However, the Fed have been fairly cautious recently in its explanation of market direction, but with the UK entering its next stage of the roadmap exit and general optimism with extremely low cases and deaths, we could see the GBPUSD rate steady and gain some support above 1.37.

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