On Monday, the British pound jumped above a critical $1.39 handle for the first time in nearly three years, largely catapulted by a broad-based weakening of the American currency, optimisms of an end to a third national lockdown alongside a rise in appetites for riskier assets.
In point of fact, the British pound made a strong comeback against its American counterpart this month following an aggressive rollout of a nationwide pandemic vaccination campaign, stoking hopes that a pandemic-battered UK economy that had contracted by the most in 300 years on 2020, might be able to witness a faster-than-anticipated recovery than those of its European gentries.
More importantly, UK had inoculated as many as 15.30 million people thus far which has been the fastest rollout of pandemic vaccine per capita for any G7 economies, British Health Secretary Matt Hancock said earlier in the day, adding to further silver lining on a bullish appetite for riskier commodities alongside currencies.
Nonetheless, in the day’s gains in the Great Britain Pound seemed to have stemmed off a broad-based weakness in American Dollar with investors remained utterly tentative ahead of January FOMC minutes’ reports scheduled to be released later this week.
On top of that, upbeat economic data such as a rise in bidding prices for homes in UK this year, fathomed up investors’ optimism further.
British pound hits highest level since April 2018
Citing statistics, in the day’s currency market round off, the British currency closed out the day 0.4 per cent higher to $1.3906 against its American peer, while versus the bloc’s common currency euro, pound sterling rose 0.3 per cent to 87.22 pence per euro after hitting a session high of 87.40 pence per euro, the highest level in more than nine months.
Apart from that, while several market analysts were quoted saying that the recent leg of blowout rally in Great Britain Pound was largely prompted by a successful Brexit deal with European Union, citing possibilities of further upward spiral in the card for a high-flying British Pound, a global head of markets at ING, Chris Turner said, “GBP continues to reap the dividends of a successful vaccine rollout and momentum is building towards a re-opening of the economy – probably starting with schools on March 8. ”