GBP

Sterling continued its steady run of strength throughout most of Tuesday before ultimately cooling off in the afternoon, with Sterling briefly hitting an 8 month high against the Euro.

The main driver of the run upwards against the Euro was German consumer confidence data underwhelming currency markets on release, delivering its worst reading since June. Any signs of the bloc's largest economy struggling to recover will be detrimental to the single market already under pressure this week from delayed vaccines. EU vaccines may cause a lot of friction over the coming weeks and months as the EU has demanded Covid-19 vaccines from AstraZeneca that are currently promised to the UK, releasing a statement stating that the pharmaceutical company must take vaccines from UK factories to make up a shortfall in supply to the bloc.

The Pound was also buoyed by news that the government will soon look to lay out the criteria for easing lockdown restrictions and hopefully give a clearer picture of the UK’s path to recovery.

USD

The US Dollar benefitted from some late-session safety buying yesterday as currency markets turned cautious as the US Federal reserve put forward concerns on the pace of the country's economic recovery. Concerns are beginning to grow on the US vaccination role out and how effective it will be to getting the US economy back on track. The Dollar also benefitted from the Treasury's postponement of the ban on American investments in companies that have alleged connections to the Chinese military.

Key announcements

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