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Sterling rallies as Covid-19 cases drop

GBP - British Pound

Yesterday sterling rallied against most of its peers as Covid-19 cases in the UK dropped for a fifth day in a row. GBP/USD broke back above the 1.38 handle after a very strong day for sterling, with GBP/EUR breaking the 1.17 handle briefly.

With very little economic data from the UK over the next week, we would expect the market to be driven by Covid-19 sentiment.

Key Movers

The euro rallied against the dollar yesterday, as the pair broke back above the 1.18 handle at the end of the European session. The market will now look to the FOMC interest rate decision and press conference on Wednesday for further direction on the dollar, however there aren't any major announcements expected, with the Jackson Hole symposium in August.

We also have Eurozone's Q2 GDP release on Friday, any upside should give the Euro a boost.

Expected Ranges

GBP/USD: 1.3730 - 1.3850 ▲

GBP/EUR: 1.1660 - 1.1750 ▲

GBP/AUD: 1.8705 - 1.8830 ▲

EUR/USD: 1.1730 - 1.1810 ▼