Daily Currency Update

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Pound left trapped as the week rumbles on

GBP - British Pound

The Pound has remained firmly trapped in a tight range over the first two days of the week, barely deviating against both the euro and US dollar. GBP/USD, often seen as a barometer of confidence in the UK has barely wobbled since the start of the week. However, as mentioned previously all eyes remain firmly fixed on Covid data and any rumours/announcements from the government, as to whether there will be a full unlocking on June 21st. If the next update isn't leaked to the press before the close of play on Friday, then the Andrew Marr show on Sunday would be the next best opportunity for market participants to anticipate any moves in Sterling.

Andy Haldane, the outgoing Chief Economist of the Bank of England has commented that the UK economist is currently going 'gangbusters' and that monetary policy stimulus may need to be turned off soon. More comments from his peers like these will support the pound but in the meantime all attention is on UK covid data, US inflation and the ECB meeting.

Key Movers

On that note, the ECB would surely have taken confidence from yesterday's latest update from Germany. The German ZEW Economic Sentiment survey came in at 79.8 yesterday and whilst it missed expectations it’s a far cry from the -49.5 figure we saw last year. German investors and analysts are clearly very confident at the moment. Eurozone Q1 GDP was also revised higher yesterday from -1.8% to -1.3%. Despite this though the recent turnaround in data and improved vaccine rollout probably won't be enough to move the dial for Christine Lagarde and the ECB. EUR/USD is acting very much like the pound at the moment and is waiting to be set alight by Super Thursday tomorrow, with the ECB press conference and US inflation release.

Expected Ranges

GBP/USD: 1.4080 - 1.4190 ▲

GBP/EUR: 1.1600 - 1.1675 ▲

GBP/AUD: 1.8260 - 1.8320 ▲

EUR/USD: 1.2110 - 1.2200 ▲