GBPUSD is rising with the launch of Corona vaccines

Mohammed Abdelkhalik
January 25, 2021

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GBP/USD Outlook: 25th January 2021

GBPUSD witnessed a recovery in the morning of Monday’s trading in the European market, as it boosted investors ’risk appetite to return to riskier assets, amid increasing hopes for the stimulus plans announced by President Biden that would support the US economy. The Coronavirus Vaccine Campaign Over the Weekend Some Support for the Pound.

Online trading investors ’optimism about the $ 1.9 trillion fiscal stimulus plan in the US announced by President” Joe Biden “continues to support their risk appetite, which will significantly contribute to the recovery of the US economy, despite concerns of the Republican Party stalling the deal.

The launch of the UK coronavirus vaccine accelerated on Saturday, with 5.9 million people now receiving the first dose.

GBPUSD fell after weak economic data

GBPUSD fell after the Office for National Statistics (ONS) released weak retail sales numbers in December, as the total volume of UK retail sales increased 0.3% from November, after which sales rose at an annual rate of 2.9%, which is below the average. An estimate of 4.0%.

Chart of GBP/USD - 25th January 2021

Core retail sales that exclude volatile food and energy products rose 0.4% in December, up 6.4% over the same period in 2019, and the median estimate for a sales increase of 6.4%.

Perhaps the most important reason for the drop in the pound last week was the manufacturing and express services figures. According to Markit, the services PMI fell to a multi-month low of 38.8, which was lower than 49.4 in December and the average estimate is 49.9.

The manufacturing sector expanded at a slower rate as the overall PMI fell from 57.5 to 52.9, and the composite PMI declined to 52.9.

The euro rises in a narrow range amid political uncertainty in Italy

The euro versus the US dollar rose marginally to trade at 1.2181, up by 0.1%, amid mounting political uncertainty in Italy, as Prime Minister Giuseppe Conte is mobilizing the ruling majority in Parliament for its success.

Italian newspapers reported that Conte is about to resign in order to form a new government that depends on a wider majority, as he needs a majority to push legislation to address the economic damage caused by the Coronavirus crisis in the country.

Author Mohammed Abdelkhalik

Professional Trader and Analyst, economist in Financial and Forex market since 2004.holds an MBA from the American University in Egypt. Mohammed works as an economic writer and technical & fundamental analyst for many international Forex and financial trading companies in both English and Arabic on a daily basis.