Pound rockets against euro: Sterling had its strongest quarter against the euro since 2015
Pound to euro exchange rate fluctuates amid vaccine row
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Such is the worsening picture across the eurozone, analysts have now claimed the sterling is now coming on the “strong side of expectations”. With the UK’s own vaccine rollout surging ahead, the sterling is now expected to outperform its rival throughout the next quarter. Indeed, the sterling had its strongest quarter against the euro since 2015, with the pound up 4.8 percent against the euro due to the successful rollout and the conclusion of Brexit.
With the UK proceeding with its roadmap out of lockdown, the British Chamber of Commerce revealed 55 percent of its members expect a higher turnover in the next 12 months than last year.
At the time of writing, the pound exchange rate stood at 1 to 1.17 euros after increasing over the last week.
Lee Hardman, currency analyst at MUFG said: “There’s maybe some initial disappointment that we haven’t broken those key levels, but generally the fundamental economic data from the UK is still coming in on the strong side of expectations.”
Against the US dollar, the pound was also trending on $1.377 at the time of writing.
Mr Hardman added: “We’re pencilling in the outperformance continuing through the next quarter.”
Rabobank senior FX strategist Jane Foley predicted the pound will remain strong versus the euro going forward as covid restrictions relax.
Indeed, Ms Foley stated the euro would continue to fall over the next three months as multiple states go back into lockdown.
Ms Foley added: “While the GBP may continue to struggle vs. the USD in the current environment, we expect that it will remain well supported vs. low yielding G10 currencies such as the CHF, JPY and the EUR.”
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The pound may rise sharply in the next few weeks as non-essential shops and the hospitality sector begin to open up.
If case levels and hospitalisations remain low, the UK proceeds will proceed to step two of the roadmap.
However, international travel is still not permitted unless for valid reasons and will not be reviewed until May 17.
On March 29, several rules were relaxed as part one of the roadmap although socialising indoors is still not permitted.
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Although indoor mixing is not permitted, a group of six are allowed outside or in a group of two households.
Despite restrictions being eased, the Prime Minister has urged the public to be careful going forward as case levels rocket on the continent.
Mr Johnson said: “What we don’t know is exactly how strong our fortifications are, how robust our defences are against another wave.
“We have seen what is happening with our European friends.
“Historically, at least there has been a time lag and then we have had a wave ourselves.
“That is why I stress the importance of everybody maintaining the discipline people have shown for so long.”
In contrast, the picture in France has forced Emmanuel Macron to call a lockdown for three weeks across the country.
Such is the situation, that Mr Macron even concluded he had made a mistake over how he has handled the situation.
Mr Macron said: “You know we have done everything to make these decisions as late as possible.
“These last few weeks, we have faced a new deal.
“We have a entered a race between on the one side the deployment of vaccination and on the other the spread in all of Europe of a new form of virus.”
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