Sterling starts the week in a strong position against the euro, having shrugged off a few jitters at the start of last week to return to a new 13-month high. Against USD sterling remains 10 to 15% stronger than last spring, which is quite astonishing when you think about it.
The driver of sterling strength remains the successful vaccine programme and its apparent effect – along with the lockdown – on the fall in Covid hospitalisations of roughly 30% each week (if not milder cases which have stopped falling).
What could move the market this week? Later today we have mortgage approval and consumer credit information, but the big day for data is early on Wednesday. On my midweek report I’ll be able to bring you the latest data on GDP, house prices and business investment data. On Thursday there is Manufacturing PMI (a reliable snapshot of the economy) for the UK and eurozone.
In the absence of any other big news, it should still be the pandemic that stays in control of sterling. With the market highly susceptible to bad news on vaccine supply, new variants and the continued programme of easing the lockdown you certainly cannot guarantee that sterling will stay so strong.
This is an excellent rate compared to any point in the past year – and pretty good against any point in the past five years – so if you are ready to buy a property or move abroad, do talk to your trader about your options on 020 8108 5337.
