News

Sterling Rebounds from 1-Week Low on Tuesday
The British pound rebounded to $1.363 on Tuesday afternoon, recovering from Monday's one-week low of $1.35, supported by broad dollar weakness as US President-elect Joe Biden's nominee for Treasury Secretary, Janet Yellen, argued that the US government should spend heavily to help the world's largest economy to recover from the pandemic crisis. Meanwhile, investors remained concerned about the negative impact of a third national lockdown on Britain's economic recovery; while the country's COVID-19 vaccination rollout continued with more than 4.0 million people having already received their first dose. On the monetary policy front, investors pushed back negative interest rates expectations to June 2021, compared with May 2021 previously estimated, after Bank of England governor Andrew Bailey warned that cutting rates below zero would create complications for the banking sector.
Published on 2021-01-19

Sterling Rebounds on Tuesday
The British pound rebounded to $1.36 on Tuesday, recovering from Monday's one-week low of $1.35, supported by broad dollar weakness ahead of Janet Yellen’s confirmation hearing at the Senate as she will argue that the US government should spend heavily to help the world's largest economy to recover from the pandemic crisis. Meanwhile, investors remained concerned about the negative impact of a third national lockdown on Britain's economic recovery; while the country's COVID-19 vaccination rollout continued with more than 4.0 million people having already received their first dose. On the monetary policy front, investors pushed back negative interest rates expectations to June 2021, compared with May 2021 previously estimated, after Bank of England governor Andrew Bailey warned that cutting rates below zero would create complications for the banking sector.
Published on 2021-01-19

Sterling Weakens Towards 1-Week Low
The British pound depreciated towards $1.35 on Monday, having touched a one-week low earlier in the session, as investors remained concerned about the negative impact of a third national lockdown on Britain's economic recovery. Meanwhile, the country's COVID-19 vaccination rollout continued with more than 3.8 million people, including over-80s, care home residents, and NHS and social care staff, having already received their first dose. The vaccine will be rolled out to the next two priority groups starting today. On the monetary policy front, investors pushed back negative interest rates expectations to June 2021, compared with May 2021 previously estimated, after Bank of England governor Andrew Bailey warned that cutting rates below zero would create complications for the banking sector.
Published on 2021-01-18

Sterling Weakens Slightly on GDP Data
The British pound was slightly down at $1.365 on Friday, after touching a two-and-a-half-year high of $1.371 the day before. Economic data showed Britain's economy contracted in November for the first time since April's record slump and less than markets had expected, due to the reintroduction of tighter coronavirus-related restrictions on activity. At the same time, hopes for an economic recovery in Britain as the vaccination rollout continued curbed the losses. On the monetary policy front, investors pushed back negative interest rates expectations to June 2021, compared with May 2021 previously estimated, after Bank of England governor Andrew Bailey warned that cutting rates below zero would create complications for the banking sector.
Published on 2021-01-15

British Pound Hits 32-Month High
GBP/USD climbed onto the 1.3700 level on Thursday, touching its highest level since May of 2018 on the back of overall dollar weakness, as investors await President-elect Joe Biden to unveil details on his stimulus plan. At the same time, markets revised lower their bets that the Bank of England would cut interest rates below zero after governor Andrew Bailey warned that would create complications for the banking sector.
Published on 2021-01-14

Sterling Little-Changed on Thursday
The British pound was little-changed at $1.365 on Thursday, not far from last week's two-and-a-half-year high of $1.3704, amid hopes for a quicker economic recovery in Britain as the vaccination rollout continues. At the same time, market pricing for negative interest rates from the Bank of England has been pushed back to June 2021, compared with May 2021 previously estimated, after governor Andrew Bailey warned that cutting rates below zero would create complications for the banking sector.
Published on 2021-01-14

Sterling Gains Towards 2-1/2-Year High
The British pound extended gains towards $1.37 on Wednesday, moving closer to last week's two-and-a-half-year high, ahead of post-Brexit talks on financial services between Britain and the EU. At the same time, there were doubts about the implementation of negative interest rates by the Bank of England, after governor Andrew Bailey warned that the UK economy was suffering a "very difficult period" and that negative interest rates would create complications for the banking sector. Conversely, policymaker Silvana Tenreyro said Monday that slashing interest rates below zero could boost the economy by more than expanding bond purchases. She also warned that the recent intensification of the current wave of Covid would imply a worse near-term outlook than anticipated in November, before the economy starts a now less uncertain recovery later in 2021.
Published on 2021-01-13

Sterling Extends Gains to Trade Above $1.36
The British pound extended gains to trade above $1.36 on Tuesday, moving closer to last week's two-and-a-half-year high of $1.37, after Bank of England governor Andrew Bailey warned that the UK economy was suffering a "very difficult period" and that negative interest rates would create complications for the banking sector. Yesterday, policymaker Silvana Tenreyro said that slashing interest rates below zero could boost the economy by more than expanding bond purchases. She also warned that the recent intensification of the current wave of Covid would imply a worse near-term outlook than anticipated in November, before the economy starts a now less uncertain recovery later in 2021. Elsewhere, Finance minister Rishi Sunak said that Britain's economy would get worse before it got better as the country faces a third lockdown.
Published on 2021-01-12

Sterling Bounces Back Above $1.35
The British pound recovered slightly to trade above $1.35 on Tuesday, remaining below last week's two-and-a-half-year high of $1.37, amid concerns about Britain's economic recovery and expectations that the Bank of England will be announcing more policy easing in the coming months. Bank of England policymaker Silvana Tenreyro said on Monday that slashing interest rates below zero could boost the economy by more than expanding bond purchases. She also warned that the recent intensification of the current wave of Covid would imply a worse near-term outlook than anticipated in November, before the economy starts a now less uncertain recovery later in 2021. Investors expect an interest rate cut as early as May. Elsewhere, Finance minister Rishi Sunak said that Britain's economy would get worse before it got better as the country faces a third lockdown.
Published on 2021-01-12

Sterling Extends Losses on Negative Rates Talks
The British pound extended losses to trade below the $1.35 level on Monday afternoon, moving further away from last week's two-and-a-half-year high of $1.37, after Bank of England policymaker Silvana Tenreyro said that slashing interest rates below zero could boost the economy by more than expanding bond purchases. She also warned that the recent intensification of the current wave of Covid would imply a worse near-term outlook than anticipated in November, before the economy starts a now less uncertain recovery later in 2021. Investors are now expecting an interest rate cut as early as May, with few analysts expecting an even earlier cut, compared with an August estimate made last month. Sterling was already falling in morning trading as the UK government is being pressured to impose additional COVID-19 related restrictions in England amid warnings that the current lockdown measures may not be tough enough.
Published on 2021-01-11

Sterling Depreciates on Monday
The British pound traded around the $1.35 level on Monday, moving further away from last week's two-and-a-half-year high of $1.37, as the UK government is being pressured to impose additional COVID-19 related restrictions in England amid warnings that the current lockdown measures may not be tough enough. At the same time, investors awaited a key speech by Bank of England policymaker Silvana Tenreyro later in the day, amid expectations that the central bank will be announcing more policy easing in the coming months. Investors see policymakers cutting interest rates into negative territory as early as May, with few analysts expecting an even earlier cut, compared with an August estimate made last month.
Published on 2021-01-11

Sterling Little-Changed on Friday
The British pound traded around the $1.36 level on Friday, remaining below Monday's two-and-a-half-year high of $1.37, amid expectations that the Bank of England will be announcing more policy easing in the coming months, as Britain's coronavirus crisis intensified and as a new national lockdown was announced this week. Money markets now expect the central bank to slash interest rates into negative territory as early as May, with few analysts expecting an even earlier cut, compared with an August estimate made last month. Meanwhile, investors welcomed Democrat victories in two US Senate runoffs in Georgia, which could pave the way to the approval of more fiscal stimulus.
Published on 2021-01-08

Sterling Weakens on Negative Rates Expectations
The British pound traded below the $1.36 mark on Thursday, moving away from Monday's two-and-a-half-year high of $1.37, amid expectations that the Bank of England will be announcing more policy easing in the coming months, as Britain's coronavirus crisis intensified and as a new national lockdown was announced this week. Money markets now expect the central bank to slash interest rates into negative territory as early as May, with few analysts expecting an even earlier cut, compared with an August estimate made last month. Meanwhile, investors digested Democrat victories in two US Senate runoffs in Georgia, which could pave the way to the approval of more fiscal stimulus, but it could also mean greater corporate regulation and higher taxes.
Published on 2021-01-07

Sterling Trades Around 2-1/2-Year High
The British pound was slightly up at $1.365 on Wednesday, not far from Monday's two-and-a-half-year high of $1.37, supported by broad dollar weakness as investors across the globe await the outcome of Georgia runoff elections. Democratic challenger Raphael Warnock has won a US Senate race in the state over Republican incumbent Kelly Loeffler, while the second contest is still undecided. A Blue Wave could pave the way to the approval of more fiscal stimulus in Washington, but it could also mean greater corporate regulation and higher taxes. On the monetary policy front, the Bank of England is seen announcing more policy easing in the coming weeks, as Britain's coronavirus crisis intensified and as a new national lockdown was announced this week. On Monday, UK Chancellor Rishi Sunak announced a £4.6 billion support package for businesses hit by the restrictive measures. On the economic data front, a final PMI survey showed the UK economy grew less than initially thought in December.
Published on 2021-01-06

Sterling Gains After Sunak Announces More Stimulus
The British pound was slightly up at $1.359 on Tuesday after UK Chancellor Rishi Sunak announced a new £4.6 billion support package for businesses hit by fresh lockdowns. Under the scheme, retail, hospitality and leisure companies will be able to claim new one-off grants worth up to £9,000 to help them through the spring; while a £594 million discretionary fund will also be made available to support businesses not eligible for the grants, but might be affected by the restrictions. Prime Minister Boris Johnson has imposed on Monday a strict new national lockdown that will remain until at least the middle of February, meaning that most non-essential businesses will close their doors until then.
Published on 2021-01-05

Sterling Little-Changed Ahead of Sunak Speech
The British pound was unchanged at $1.356 on Tuesday as investors remained cautious ahead of UK Chancellor Rishi Sunak's announcement on additional stimulus later on the day. Prime Minister Boris Johnson has imposed a strict new national lockdown that will remain until at least the middle of February, meaning that most non-essential businesses will close their doors until then. First Minister Nicola Sturgeon has also placed Scotland under a tougher lockdown.
Published on 2021-01-05

Sterling Falls on Tougher National Lockdown Fears
The British pound reversed gains to trade 0.9% lower at $1.35, after touching the $1.37 level for the first time since May 2018 earlier in the session. Concerns about Britain's economic recovery mounted after Scotland was placed under a national lockdown similar to the one introduced in March, and as UK PM Boris Johnson is expected to follow suit and put England under tough national lockdown. Meanwhile, a new trade deal between the EU and UK came into force on January 1st and the distribution of Covid vaccines continued. Sterling has gained over 2% against the US dollar in 2020, helped by massive fiscal and monetary policy support and the approval of a post-Brexit trade deal.
Published on 2021-01-04

Sterling Hits $1.37 for 1st Time Since May 2018
The British pound touched the $1.37 level for the first time since May 2018, as a new trade deal between the EU and UK came into force on January 1st and as the distribution of Covid vaccines continued. Sterling has gained over 2% against the US dollar in 2020, as investors hoped that the approval of a post-Brexit trade deal, coupled with the roll-out of coronavirus vaccines and massive fiscal and monetary policy support, could boost Britain's economic recovery in 2021.
Published on 2021-01-04

Sterling Heads for 2% Yearly Gain
The British pound touched $1.365 on the last trading day of the year, extending its upward momentum to levels not seen since May 2018, and was on track to book an over 2% yearly gain in 2020. Investors hoped that the approval of a post-Brexit trade deal, coupled with the roll-out of coronavirus vaccines and massive fiscal and monetary policy support, could boost Britain's economic recovery in 2021. Furthermore, a broader depreciation of the dollar, which has hit a 32-month low, exacerbated this bullish sentiment.
Published on 2020-12-31

British Pound Hits 31-Month High
The GBP/USD tested the 1.3625 area on Wednesday, extending its upward momentum to levels not seen since May of 2018 and on track to book an over 2% yearly gain in 2020. Investors hoped that the approval of a post-Brexit trade deal, coupled with the roll-out of coronavirus vaccines and massive fiscal and monetary policy support, could boost Britain's economic recovery in 2021. Furthermore, a broader depreciation of the dollar, which has hit a 32-month low, exacerbated this bullish sentiment.
Published on 2020-12-30