Pound (GBP) Steady on UK Vaccination Optimism
The Pound (GBP) remained stable yesterday as the UK’s vaccination programme continued to show strong results, with roughly 18% of the adult population having already received at least one jab.
While the government looks to be on track to vaccinating 15 million of the most vulnerable people by mid-February, ongoing uncertainty over when the current lockdown will start to be eased limited the upside in Sterling.
Looking ahead, UK coronavirus developments will likely remain the main catalyst of movement in the Pound today, although GBP investors will also look to a speech by Bank of England Governor Andrew Bailey for fresh impetus later this afternoon.
Euro (EUR) Firms on USD Weakness
The Euro (EUR) struck higher on Tuesday, with the single currency receiving a boost thanks to its negative correlation with the US Dollar (USD).
However, these gains were tempered somewhat amidst ongoing concerns over the EU’s vaccination drive as well as the publication of some weaker-than-expected trade figures from Germany.
Turning to today’s session, the focus for EUR investors is likely to be on a speech by Christine Lagarde, with the President of the European Central Bank (ECB) potentially boosting the Euro depending on the tone she strikes.
US Dollar (USD) Weakens as US Treasury Yields Fall
The US Dollar ticked lower through yesterday’s European trading session, falling in step with US Treasury yields.
This slide in yields came amidst uncertainty over the next US fiscal stimulus package as disagreements amongst Democrats over the eligibility for stimulus checks threatens to delay the relief.
In the spotlight today will be the publication of the latest US consumer price index. Will another acceleration in inflation drive the US Dollar lower this afternoon?
Canadian Dollar (CAD) Dips as Oil Rally Runs out of Steam
The Canadian Dollar (CAD) fell back on Tuesday as the appeal of the commodity-linked ‘Loonie’ weakened as the recent surge in oil prices appeared to stall.
Australian Dollar (AUD) Rallies in Risk-On Trade
The Australian Dollar (AUD) struck higher overnight on Tuesday, with the risk-sensitive ‘Aussie’ receiving a boost as optimism over coronavirus vaccinations helped to drive a notable improvement in market sentiment.
New Zealand Dollar (NZD) Firms as Mood Improves
The New Zealand Dollar (NZD) also rallied in overnight trade, with the ‘Kiwi’ also benefitting from the marked improvement in market risk appetite.