The GBPEUR exchange rate is 0.05% lower halfway through the Monday trading session, however the pair was higher by 0.30% at the open and has given up those gains. A weaker close today could be an ominous sign ahead of the latest unemployment figures tomorrow.
GBPEUR trades at 1.1542 and weaker pound data this week could see the 1.15 level give way after a move below there was halted by sterling bulls.
Sturgeon Talks Traffic Lights
A traffic light system for international flights “poses a risk” for bringing new variants, to the UK, said Scottish First Minister Nicola Sturgeon.
The British government heads are still saying this with a straight face despite that the UK borders remain open for travellers coming in. Scotland has a tougher set of rule with people arriving from overseas having to stay in a quarantine hotel. Britons coming back to England must only do so if it was a “red list” departure.
Ms Sturgeon’s remarks were made while the travel industry has increased their potential destinations for UK travellers on May 17th. The US, Israel, Iceland, Ireland, Malta, Australia and New Zealand will be among the nations making the list, with the latter two starting their own travel bubble this week.
The news will be a boost for tourist operators, although it means that some Britons will be taking their quarantine savings to spend abroad, rather than in the UK economy and that could affect the recovery in some sectors.
Britain to Miss Vaccine Deadline
The UK will see a shortfall in second-quarter deliveries of the Moderna vaccine after the US drug maker struggled to meet demand.
“The trajectory of vaccine manufacturing ramp-up is not linear, and despite best efforts, there is a shortfall in previously estimated doses from the European supply chain,” Moderna CEO Patricia Gauthier said. EU and Swiss deliveries are not expected to be affected, although Madrid was shutting its mass vaccination centre over supply issues so the last stages of the campaign is not going smoothly on either side of the channel.
Markets are now waiting for tomorrow’s release of UK unemployment figures with the country looking at a -147k loss in jobs, despite the ongoing furlough program. The pound is weaker on Monday and could see further losses on the week if the number disappoints. Recent services PMI data did suggest some hiring with businesses getting more clarity from the reopening roadmap.
The GBPEUR will likely trade within the current day’s range of 1.1531 to 1.1587 ahead of the data. Wednesday will bring inflation figures from the UK, while Thursday is another ECB interest rate meeting. The central bank are unlikely to make any additional moves on rates or stimulus for that one as policymakers await more data from the reopening of economies before considering the need for stimulus.
Get in touch using the form below to discuss these factors in further detail ahead of your currency exchange.