The pound rose to its highest levels against the euro since May yesterday and remains strong against both the euro and the dollar this morning. This follows the Bank of England’s unanimous decision to keep interest rates at 0.1%. The BoE has given banks six months to prepare for potential negative interest rates, however, it emphasised that this does not mean such a move should be anticipated.
Sterling’s boost also comes from the BoE’s optimism of a strong economic rebound in the spring as the UK’s vaccine programme expands and consumer confidence returns. They believe that the UK economy will fare better in the first three months of 2021 than during the first March lockdown due to businesses being “better prepared”.
In the continued efforts to prevent the spread of new strains of the coronavirus, UK residents entering the country from any “red list” countries will have to quarantine in a hotel for 10 nights. This comes into force on the 15 February.
