Despite the positive news of a Brexit trade deal being done right at the eleventh hour of 2020, Sterling exchange rates have failed to really push on and gain ground against most major currencies. If anything, we have seen the pound fall away against the majority.
News on Monday evening that a third lockdown had to be bought into place for the UK has no doubt dented sentiment in the Sterling and the UK and just as it looked like we may see the pound have a good run of form once again something comes out to weigh it back down again.
It does feel like we may be stuck in a lockdown for a good number of weeks now, which will make the economic hangover much tougher to shake once we get back to normal, or the new normal as its now known, but there could be light at the end of the tunnel, with Sterling exchange rates having a more positive 2021.
First and foremost, keep in mind that there the possibility of a no deal Brexit had been really weighing down the pound for almost 4 years and that issue has now been removed, this should ultimately be a huge positive as a no deal Brexit had the potential to cause economic chaos, at least for the short term anyway.
On top of this, the UK is administering the vaccine already and rolling out a vaccine program way ahead of most other economies, this should (as long as things go to plan) mean that the UK economy is one of the first to burst out of the traps, couple this with the positive feeling around Brexit being done and a nation that has been locked down for a long period of time and is ready to go out and spend, there may be room for some optimism for 2021.To discuss these factors in further detail you can get in touch using the form below.