Coronavirus

The Euro-to-Dollar rate was consolidating a recovery of its 200-day average Tuesday having declined to back off from 1.19 amid increasing signs that it has bottomed out, some of which prompted Goldman Sachs to warn that risks to the bank's bullish forecasts are now shifting to the upside.

Foreign exchange analysts at two leading global investment banks are looking through the Euro's recent weakness and tell clients they see the single currency rebounding in tandem with an acceleration in the EU vaccination programme.

The British Pound is on course for a second consecutive daily decline of over half a percent, a run of losses not seen since December 2020.

Expectations for a drop in vaccine supplies to the UK in April comes as supplies to the EU jump significantly, a development that could apply some downside pressures to the Pound-Euro exchange rate.

The British Pound recovered through the latter part of the previous week with analysts saying positive sentiment concerning the UK's vaccine-driven economic rebound remains the fundamental source of support for the currency.

A proposed ban or limit on vaccine exports to the UK from the EU has been credited by numerous foreign exchange analyst we follow as being behind a recent decline in the value of the British Pound, however such a move is being overblown says Stephen Gallo, European Head of FX Strategy at BMO Capital Markets.

The British Pound and Euro would both likely be losers in a spat over vaccines between the EU and UK, with the U.S. Dollar likely to benefit according to a number of analysts we follow.

The UK economy will be boosted by a sizeable pick up in consumer spending in 2021 as pent up savings are spent according to economists at Deutsche Bank, who say that the Bank of England might be underestimating the scale of the consumer-lead rebound.

The British Pound's strong start to 2021 could extend as the UK's vaccination programme is reportedly set to accelerate over coming days, although some analysts warn the currency's period of outperformance will likely be brief and declines into year-end are possible.

The UK government will likely bring forward its reopening plans for the country as the vaccination programme reaches a tipping-point say analysts at a major investment bank, a prediction which if proven correct could aid further gains in Pound Sterling.

The British Pound holds onto its 2021 gains after the Prime Minister Boris Johnson revealed a roadmap out of lockdown that could see the country back to normal by mid-year, provided the covid-19 pandemic is quashed by the country's vaccination programme.

The Pound surged against all major counterparts Thursday, extending its 2021 lead in a somewhat mysterious outperformance of not only other currencies but also the market consensus, as it emerges that Sterling has benefited from an accelerating interest among "real money" buyers. 

The British Pound recorded a new nine-month high against the Euro and a new 34-month best against the Dollar at the start of the new week, driven by rising global stock markets and expectations that the UK economy was on the cusp of a strong economic recovery.

The UK's vaccination programme received a boost on news of two new vaccines that have proven effective in trials against both the UK and South African variants of the disease.

The Lloyds Bank Business Barometer - a key insight into business confidence - has fallen in January, however levels of confidence are still more elevated than they were for most of 2020.

The UK economy could be on course to recover all of its coronavirus-inspired losses as early as next year, according to forecasts from Capital Economics, although only so long as HM Treasury doesn't opt to snatch defeat from the jaws of victory at the March budget. 

U.S. Dollar exchange rates were climbing in a risk-averse market on Friday as investors weighed the prospect of a large U.S. stimulus bill securing safe passage through Congress, a development that some analysts say would likely weigh on the Euro and support the Dollar Index. 

The UK's economy contracted by 2.6% during November 2020, a decline that will not be surprising given the UK economy was subject to a second national lockdown owing to rising covid-19 cases.

The Dollar Index reversed lower Friday while other currencies were lifted by default when non-farm payrolls figures showed the U.S. job market cracking around year-end and after a period when coronavirus containment efforts were again closing down parts of the world's largest economy. 

2021 is expected by analysts to be the year of the vaccine, in which the currency of the economy that is unlocked first will likely be the currency that is sought.