Yes, you read that correctly- As I am writing this on my day off (And a day we cannot trade)- GBPEUR has hit a new high of 1.18. The recent move in Sterling is still very much in line with the reopening of the UK and the PM’s roadmap. The latest announcement has stated that everything will be on track for the next stage of reopening on April 12th where the UK will see nonessential shops reopen and outdoor dining areas.
The theme of the “Vaccine” trade is still very much in motion and I do believe there is still room to go in particular pairs- now we have breached the 1.18 target for GBPEUR I do not see why 1.20 can’t happen, and I expect GBPUSD exchange rates to start drifting back towards 1.40 as well.
April is usually a good month for risk, so I am expecting to see a more positive flow in stocks and risk on pairs such as GBPUSD- generally, April is quite supportive for Sterling exchange rates as well- so if you are looking to sell GBP, April could be a great month to catch some moves. The general trade between GBP and EUR is down to lockdowns and vaccinations and as Europe as a whole seems to be uncertain as we are seeing some cities enter lockdown again- I do see the coming month to be supporting for GBP and less so for the Euro. This of course will change as cases come down again across Europe and we begin to see more reopening there- which I hope is very soon!
We do have some data releases this week, the most noteworthy being PMI’s from the UK on Wednesday (All expected above 50 which is positive for GBP), FOMC minutes which I am not expecting much reaction on- a speech from Fed Chair Powell on Thursday which will be one to watch if you are trading the U.S Dollar- and jobs data out of the U.S.
As always, if you have an upcoming transaction you would like assistance with- please don’t hesitate to contact me.
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