Fears that the Indian variant would delay the lockdown were shrugged off by the markets yesterday and the pound strengthened by nearly half a percent against EUR and a little more against USD.
The variant could be as much as 50% more transmissible than the currently dominant Kent variant, but the evidence is that vaccines are effective against it. However, with 30% of the UK adult population still awaiting even a first vaccine, ministers are being cautious in allowing the end of restrictions in June.
This morning we have seen good news on unemployment, which fell to 4.8%, while the number of people finding jobs was 84,000 – far above the expected 50,000.
Despite this, sterling has failed so far to capitalise on yesterday’s gains against the euro, losing around half of yesterday’s gains, but powering further ahead against the dollar.
A busy week for data continues with prices data tomorrow and PMI on Friday.
