The Pound to Euro (GBP/EUR) exchange rate was bolstered this morning as optimism surrounds the UK vaccine rollout.
The pair is currently trading around €1.1116, up from opening levels of €1.1062.
Pound (GBP) Bolstered on Hopes of Economic Recovery
The Pound (GBP) was supported this morning following on from Prime Minister Boris Johnson’s coronavirus press conference yesterday evening.
According to the Prime Minister on Thursday, a total of 1.5 million people had received their first Covid-19 vaccine. This is an increase of 200,000 people in just one day and points to rate of 1.4 million people being vaccinated a week if replicated.
Johnson said the army had been brought in to assist with the logistics of ramping up the vaccination programme while “hundreds” of community pharmacies would be asked to assist with the distribution of the vaccine.
The vaccine will hope to provide confidence that the next unlocking of the economy will be a more permanent one.
Robert Howard, a Reuter’s market analyst speaking on the vaccine rollout said:
‘Sterling might find itself in the unusual position of being a hero among major currencies if the UK succeeds in vaccinating around 14 million people against COVID-19 by the middle of February.’
Euro (EUR) Lacklustre as Data Releases Do Little to Support the Currency
The Euro (EUR) was subdued this morning as the seasonally adjusted Unemployment Rate in the Eurozone declined to 8.3% in November from 8.4% in October, the reading came in slightly better than the market expectation of 8.5%, the unemployment drop was an unexpected positive fall.
The Euro also suffered as Germany recorded their highest COVID daily deaths, and cases across Europe continue to rise.
Furthermore, in Covid-19 news the European Commission president Ursula von der Leyen gave an update on the vaccination rollout in the bloc.
Amid criticism that too few jabs were purchased, and that the rollout has been too slow, the EU has now secured another 300 million doses of the Pfizer/BioNTech vaccine.
Speaking this morning, von der Leyen said:
‘We have already a contract, so there will be no lengthy negotiations, it’s a proven vaccine, so authorisation is done, member states know the vaccine so they know the logistics behind it, therefore it brings certainty for the planning, and it creates an additional momentum for vaccination in Europe.’
‘We shouldn’t forget in the summer of last year there were over 160 different people bidding for vaccines, trying to invest in research. We filtered out the six contracts we now have, and we know these were the right places to focus on.’
Pound to Euro (GBP/EUR) Outlook: Coronavirus Remains in Focus as Moderna Vaccine Approved
Looking ahead, Pound (GBP) investors will continue to focus any coronavirus lockdown concerns or uncertainty, and any indication that Covid-19 infections are continuing to rise could prove GBP-negative.
Euro (EUR) traders will also be keeping an eye on the Eurozone’s own Covid-19 situation as lockdowns are implemented across the bloc.
Euro investors will also be waiting on manufacturing and unemployment data releases next week which could add pressure to the currency.