On Friday, the Pound strengthened against a number of its peers after the G7 summit started.
Despite increasing coronavirus cases and continued tensions between the UK and the EU around the Northern Ireland protocol, the Pound still managed to make some decent gains. According to the Foreign Exchange Market, this saw the Pound round off the day at 1.1652 against the Euro and 1.4109 against the US Dollar.
It was a different story for the Euro on Friday as the single currency continued to drop to a new one-month low against the Pound. Concerns remain around the European Central Bank’s cautious tone on the monetary policy as this continued to place pressure on the Euro. There was also further pressure added as a rebound in the US Dollar saw the currency lose out to the negative correlation with the Greenback.
The US Dollar gathered momentum on Friday, eventually reaching a new one-month high against the Euro. Along with this, demand for the US Dollar increased thanks to a risk-off sentiment ahead of the interest rate decision from the Federal Reserve. It’s likely that the currency could benefit from improved consumer inflation today.