The Pound Euro (GBP/EUR) exchange rate has strengthened this morning as reports indicate that British citizens may be able to travel abroad sooner than expected.
At the time of writing the GBP/EUR pairing are trending around the 1.1698 level as the Euro suffers on the back of the latest Federal Reserve interest rate decision.
Pound (GBP) Strengthens on UK Travel Hopes
The Pound has strengthened this morning following reports that British citizens who are fully vaccinated will be able to travel to amber list countries.
A government spokesperson commented on the reports saying:
‘As set out in the Global Travel Taskforce, we are working with industry for a safe return to international travel, guided by one overwhelming priority, public health. Decisions on our traffic light system are kept under constant review, and based on a range of health factors.’
‘Recognising the strong strategic rationale and success of the vaccine programme, we have commenced work to consider the role of vaccinations in shaping a different set of health and testing measures for inbound travel.’
Sterling has suffered in previous days following the announcement from UK Prime Minister Boris Johnson that current lockdown restrictions would be enforced for a further four-week period.
Euro (EUR) Weakens on Federal Reserve Interest Rate Decision
The Euro has weakened against many of its major rivals today following the latest interest rate decision from the Federal Reserve.
Markets remain jittery this morning after the US Federal Reserve last night indicated that interest rates will rise from record lows sooner rather than later.
The Fed said in a statement that:
‘Progress on vaccinations has reduced the spread of COVID-19 in the United States. Amid this progress and strong policy support, indicators of economic activity and employment have strengthened.’
A sharp resurgence in the US Dollar following the latest decision has caused the Euro to weaken, more so a lack of notable data has left the single currency open to further losses.
Pound Euro Exchange Rate Outlook: UK Retail Sales in Focus
Pound investors will keep an eye on the latest retail sales figures from the UK for May, which if continue to rise could provide an added boost to Sterling heading into the weekend.
In absence of any data, Euro traders will continue to focus on the strengthening of the US Dollar tomorrow, further support for the ‘Greenback’ would cause EUR to stumble.
The GBP/EUR pairing will continue to be driven by any further coronavirus developments over the weekend.