The GBPEUR rate is 0.22% higher in early trading on Monday as sterling continues to edge out the single currency. The latest virus news at the weekend saw the UK hit its target of 15 million vaccines administered. Tomorrow brings the release of fourth quarter GDP for the Eurozone, which could have an effect on the week’s direction.
GBP to EUR is trading at 1.1455 with the 1.1500 resistance level now in focus.
UK Vaccination Progress
The UK has met its target of 15 million vaccines administered a day ahead of schedule. Vaccines Minister Nadhim Zahawi confirmed the result to reporters and said 15 million had now received a first dose. The figures mark 25% of UK adults who have received a first shot.
The news comes as Boris Johnson gets ready to address the nation and this event will help with his February 22nd announcement on the escape from lockdown. The initial plan is to get kids back to school in March and open up other areas, such al fresco dining events in April.
The latest vaccine news puts the UK on track for the second quarter economic bounce that has been predicted by the Bank of England and this is giving strength to the pound sterling.
Eurozone GDP Figures Released on Tuesday
Tomorrow sees the release of fourth quarter GDP figures for the Eurozone, with analysts expecting a year-on-year drop of 5.1%, with a quarterly drop of -0.7%.
The figures highlight the difference with the UK, where Britain saw a quarterly growth of 1.2%. The Eurozone will want to close this gap, especially as they are trailing behind in the vaccine push.
Tuesday also brings the release of ZEW Economic Sentiment figures for the European countries and Germany’s own reading. Traders have given less weight to these numbers in recent months as the mood amongst investors and consumers during the lockdowns have been gloomy.
The UK will see the release of its latest inflation figures on Wednesday and the market is expecting a print of 0.5%, with a 1.3% reading for the core number. Both are expected to be 0.1% lower than last month and a higher number could make the Bank of England sweat.
The Federal Reserve are reportedly looking at March rate hike in the US and if Britain’s inflation is higher going into the economic reopening, the market could switch from talk of negative rates, to higher rates.
Interest rates in the UK are stuck at a record low of 0.1% and any increases would put pressure on the UK government budget. Rishi Sunak will deliver his latest budget on March 4th so it is a busy few weeks for the GBP to EUR exchange rate. Get in touch using the form below to discuss these factors in further detail, I’ll be happy to respond personally.