Sterling begins the week at its highest point for two weeks against the US dollar and once again trying to break above the narrow range it’s been trading at for the past two months against the euro.
Healthwise, Covid-19 is back in the driving seat. Cases in the UK are rocketing again, currently 50% of the way to January’s rate and tipped to go much higher within days.
For the economy and the pound however, as well as for those infected, vaccinations have taken the sting out of the tail of the pandemic, plus the fact that the Delta variant has also taken a hold in mainland Europe.
As the end of restrictions next Monday allows the virus to let rip through the as-yet unvaccinated younger population and those areas where vaccine uptake has been much lower, there is plenty that could change in the weeks ahead.
Sterling could, therefore, be in for a rocky time. Indeed, although it could just be a case of “the morning after the night before”, at least one senior bank analyst reporting on the currency websites this morning is pessimistic about the pound’s near-term performance against the euro.
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