The Pound took a tough stance during trading on Tuesday, with investors taking hope from the speed at which the vaccines are being rolled out. The hope is that the first target will be met and that this will enable parts of the economy to be reopened.
The currency is also likely to gain support from the consumer price index today following the news that inflation was better-than-expected in December. As trading came to a close yesterday, the pound finished the day at 1.124 against the Euro and 1.3644 against the US Dollar according to the Foreign Exchange Market.
The Euro gathered some strength yesterday following the negative correlation with the EUR/USD pairing, giving it the ability to take advantage of the weakened US Dollar. This improvement in the Euro followed a rise in sentiment in the German economy. The first policy meeting of the year for the European Central Bank is going to be the main focus for investors today.
Further hope of additional US stimulus saw the US Dollar take a fall as market sentiment was bolstered, impacting the demand for the safe-haven currency. However, much of the spotlight will be on the inauguration of Joe Biden today, leaving investors paying close attention to his policy priorities.