FXTM information and reviews
IronFX information and reviews
Libertex information and reviews
FXCC information and reviews
Markets.com information and reviews
FxPro information and reviews
42 294.79

The Pound while the UK Loosens Restrictions

8 April 2021

Looking at the most traded asset during the month of March, we can see the British Pound was the second most traded by our traders in terms of volume. As part of this blog we will look at how the currency has been massively increasing in value due to the devaluation of other major global currencies such as the US Dollar, Euro, and Yen, while the minor currencies such as the Pound, Australian and New Zealand Dollar have flourished. The latest movement for the Pound though has made investors rethink their stance as both the EURGBP, and GBPUSD has seen an increase in volatility against the Pound as the country prepares to loosen economic and social restrictions.

The UK has been wrapped in a nationwide lockdown for many months now, and much longer than their European partners. For this reason, the market has not necessarily been focusing on the lockdown itself to determine their stance in terms of their trade positioning. However, now that we are entering a new phase, traders are evaluating to determine how the Pound is likely to react to the opening of the economy. As of today, we are yet to witness any major positive movement.

Today, the Pound came under pressure from the March data on the UK Services PMI. The indicator entered the growth zone, having increased from 49.5 to 56.3 points, but turned out to be lower than the forecast (56.8 points). Industry officials cite an increase in orders stemming from the relaxation of quarantine restrictions, and two-thirds of service-based businesses said they hoped to grow during the year. Also, the Pound was reduced by comments from representatives of the European Medicines Agency, who recognized the link between vaccinations with AstraZeneca and the formation of blood clots. These claims could slow down vaccination in the UK population, as this is the most commonly used drug for the widespread inoculation.

Starting today in Wales, vaccination begins with a drug from Moderna, which was not previously available in the country. The head of the Ministry of Health in the United Kingdom, Matt Hancock, noted that more than 60% of the population has already received their first dose, and the new drug will help accelerate the pace of vaccinations.

Like most other world currencies, for a long time, the British Pound had practically no reason to strengthen due to the extremely difficult epidemiological situation in the UK. However, from the beginning of March, the situation began to change for the better. Tough restrictive measures, along with a massive vaccination program, began to pay off, and the number of new cases detected began to decline. Wanting to emphasize the positive dynamics yesterday, British Prime Minister, Boris Johnson, said that a large-scale program to lift the current restrictions will begin on April 12th. Pubs, hairdressers, and non-food shops will resume their work. Large-scale indulgences will also affect the sports sector. The ability to sell tickets for stadiums with 25% and 50% occupancy will significantly support a large number of football clubs, for which sporting events are their main source of income.

So, what should we be concentrating our evaluation on as time progresses? This is what traders should be thinking while trading the asset, whether fundamental, technical, sentimental analysis, or even all three. Firstly, it is important to be analyzing not only the Pound, but also the counter currency, for example the Euro alongside the EURX, or the US Dollar alongside the USDX. Looking at the next 10 days worth of trading, there are a number of releases which are likely to have a level of influence over the exchange rate. Table below with further information:

As you can see from the above, it is vital to follow the reaction of the currency to the new reality. Most likely as time progresses analysts are likely to expect and predict healthier economic figures such as economic activity, confidence, and growth; it will be important that the actual releases live up to expectation. We hope this blog has given you a clear understanding on the importance of monitoring price movements and developments in order to pre-determine and plan current and future trades.

This article was written and submitted by eXcentral. 

Disclaimer: This material is considered a marketing communication and does not contain, and should not be construed as containing investing advice or a recommendation, or an offer of or solicitation for any transactions in financial instruments or a guarantee or a prediction of future performance. Past performance is not a guarantee of or prediction of future performance.

Risk Warning: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 76.81% of retail investor accounts lose money when trading CFDs. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.



Stock Futures Up Ahead Of Fed Meeting
Stock Futures Up Ahead Of Fed Meeting

Futures in the United States and Europe are trading higher today, as investors focus on China’s Evergrande whirlwind, which has even overshadowed the Federal...

22 Sep 2021

Gold's sudden glow in a falling market
Gold's sudden glow in a falling market

Gold's ability to resist the general downtrend speaks to investor confidence that global central bank policies will remain soft enough to avoid triggering a global downward asset sell-off spiral...

21 Sep 2021

Forex and Cryptocurrency Forecast for September 20-24, 2021
Forex and Cryptocurrency Forecast for September 20-24, 2021

The dollar continues to strengthen, and the EUR/USD pair moves south. Starting on Monday September 13 at 1.1810, it ends the five-day run at 1.1730. The movement...

20 Sep 2021

Gold and Silver looking into the abyss
Gold and Silver looking into the abyss

Strong US data revived bets on an imminent QE rollback from the Fed, supporting the dollar and causing bond yields to rise. The news triggered a more than 2% plunge in gold prices...

17 Sep 2021

Stocks pick up some bid after textbook SP 500 bounce
Stocks pick up some bid after textbook SP 500 bounce

European stock markets were modestly higher on Thursday after a rebound in the US and another dip for Asian equities overnight. Hong Kong down 1.7%...

16 Sep 2021

Stock Futures Trade Lower, Investors Worry About Fed Tapering
Stock Futures Trade Lower, Investors Worry About Fed Tapering

US and European futures are trading lower today, following a retracement in US indices. The Dow Jones Industrial Average fell nearly 290 points, wiping out gains...

15 Sep 2021

Editors' Picks

OctaFX information and reviews
HotForex information and reviews
XM information and reviews
FXCM information and reviews
Vantage FX information and reviews
Vantage FX
Moneta Markets information and reviews
Moneta Markets

© 2006-2021 Forex-Ratings.com

The usage of this website constitutes acceptance of the following legal information.
Any contracts of financial instruments offered to conclude bear high risks and may result in the full loss of the deposited funds. Prior to making transactions one should get acquainted with the risks to which they relate. All the information featured on the website (reviews, brokers' news, comments, analysis, quotes, forecasts or other information materials provided by Forex Ratings, as well as information provided by the partners), including graphical information about the forex companies, brokers and dealing desks, is intended solely for informational purposes, is not a means of advertising them, and doesn't imply direct instructions for investing. Forex Ratings shall not be liable for any loss, including unlimited loss of funds, which may arise directly or indirectly from the usage of this information. The editorial staff of the website does not bear any responsibility whatsoever for the content of the comments or reviews made by the site users about the forex companies. The entire responsibility for the contents rests with the commentators. Reprint of the materials is available only with the permission of the editorial staff.
We use cookies to improve your experience and to make your stay with us more comfortable. By using Forex-Ratings.com website you agree to the cookies policy.