[vc_row][vc_column][vc_column_text]The pound struck higher last week, being bolstered by economic optimism following the publication of the UK’s 2021 Budget.

At the same time, the US dollar roared higher last week, rising in tandem with surging US Treasury yields.

Sterling, meanwhile, has edged higher so far this week, with GBP/EUR ticking up to €1.16 and GBP/USD rallying just shy of US$1.39.

Looking to the week ahead, the European Central Bank’s (ECB) latest policy meeting looks to be top of the agenda this week, with the bank’s forward guidance proving fresh impetus of movement for the euro.

The pound ticked higher last week as Chancellor Rishi Sunak’s Budget statement helped to bolster UK economic optimism.

Sterling actually started poorly in the run up to Sunak’s statement on Wednesday, however, amidst speculation over potential tax hikes which might be part of the Budget.

While GBP investors were wary of the corporation tax hikes, which were included in the Budget, the fact that they would not come into effect until 2023 helped to soften the blow.

Ultimately the Budget was met by a broadly positive reaction from markets, with investors welcoming Sunak’s pledge to do ‘whatever it takes’ to support the UK’s economic recovery and his outline of unexpectedly generous stimulus measures.

However, the pound found itself facing some resistance in the latter half of last week as recent coronavirus statistics from the UK started to show signs that the rate of decline in new cases is starting to slow, with GBP investors fearing how this could impact the government’s reopening plans should this slower trend persist.

So far this week, we have seen the pound make some modest gains on the back of comments from Bank of England (BoE) Governor Andrew Bailey, in which he suggested that economic optimism in the UK is on the rise.

Still to come this week we have the UK’s latest monthly GDP release, which could put some pressure on Sterling sentiment later in the session as January’s figures are expected to report a deep contraction in growth as the latest national lockdown came into effect.[/vc_column_text][/vc_column][/vc_row][vc_row][vc_column][vc_column_text]

To request an instant quotation on a currency quotation please click here

* Information courtesy of Currencies Direct
Currencies Direct is one of Europe’s leading non-bank providers of currency exchange and international payment services. Since we were formed in 1996, we’ve maintained our focus on providing innovative foreign exchange and international currency transfer services to corporations of all sizes, online sellers and private individuals. We have also expanded our services to provide dynamic and pioneering “business to business” solutions to help companies, tier 2/3 banks and other non-bank financial institutions to process their international payments. Our headquarters are in the City of London (United Kingdom) and we have operations in continental Europe, Africa, Asia, and the United States. Currencies Direct is jointly owned by private equity firms Palamon Capital Partners and Corsair Capital.

[/vc_column_text][/vc_column][/vc_row]