Tuesday was yet another day of gains for the Pound as it rose to $1.4119 against the USD and €1.1619 against the Euro, according to the Foreign Exchange Market.
Despite this, there was not good news when it came to unemployment as this increased to 5.1% in December, with the jobless rate reaching its highest rate since 2016. However, the currency still continues to strengthen while the remainder of this week is going to be governed by coronavirus as more information is released about the lockdown exit roadmap.
The laboured vaccine rollout is continuing to cause problems for the EU, as it looks as though the Bloc won’t be following the UK and that means that the Euro struggled yesterday. Investors are concerned that the economic recovery in 2021 is going to be slow and difficult. However, the revision of the German GDP reading from 0.1% to 0.3% might deliver some hope for the single currency moving through the week.
News that the US economy is a long way off from seeing inflation and improved employment figures causes the US Dollar to edge lower yesterday. While the strong jobs market provides some hope, it is not enough for the Federal Reserve to tighten its monetary policy. As this week moves forward, the stimulus package from President Biden is going to be the main focus for investors.