GBP : Unlocking The Economy

(Mon, 15 Feb 2021). The UK government hit its ambitious target of 15 million vaccinations over the weekend, two days ahead of schedule, with one in four adults vaccinated. The government is now looking to vaccinate another 17.2 million people before the end of April. The success of the vaccination program is now allowing the government to consider lifting some lockdown restrictions from mid-March in an effort to re-boot the economy. UK PM Boris Johnson is expected to unveil his plans in a speech on February 22.

GBP/USD continues to grind higher as investors begin to price-in the ongoing benefits of the government’s vaccination program. The UK economy remains weak and the government is hoping that when lockdown measures are ended that the UK population will start spending again. Last week, Bank of England chief economist Andy Haldane predicted that the UK economy would bounce back ‘like a coiled spring’ with consumers set to spend up to GBP250 billion of savings. The weekly GBP/USD chart shows a strong bullish trend starting in May last year, taking out old horizontal highs. Cable has only had two negative weeks in the last 15 weeks and 1.4000 beckons. Above here, the mid-April 2018 high of 1.4377 is the next target.

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