- Multi-Year High for Sterling Against Dollar
- Move Comes Despite Disappointing Data
- Yellen in Push for More Stimulus
The GBP soared above 1.40 to an almost 3-year high today against the Dollar. This push comes as many in the forex market reach for profits in the Dollar that had recently been growing stronger. Even disappointing retail data, and US employment numbers could not stop the move. Also with a possible impact is Treasury Secretary Janet Yellen. She has furthered the call for increased stimulus that has stocks trading higher before the bell.
Sterling Hits New Heights Against Dollar
The Pound had already been performing well following the conclusion of an ongoing Brexit debacle which dragged on over trade talks. Since departing the EU though, the UK has shown their efficiency in dealing with COVID-19 vaccinations and quarantines even if the economic data has been a slight let down.
This has provided the GBP with more of its own strength presently than the Euro, and although both are notably trading higher today, the main beneficiary of the Dollar return to weakness has been Sterling. At present, everything seems in favor of the Pound pushing even higher as infection rates in the UK continue to fall, and the country progressively returns to normal. Everything in the US meanwhile points to the Greenback remaining at weaker levels.
Disappointing Data Fails to Dampen Optimism
There were less than impressive figures to consume on both sides of the Atlantic this week. The number of US weekly jobless claims ticked in higher than expected while in the UK, retail sales for the month of January dropped 8.2%, a number that was also higher than expected and a long way apart from the surge in US consumer spending for the same month.
Even this though failed to break British spirits and the movement of the Pound upward. Forex brokers are clearly seeing traders who are shrugging off these concerns in favor of a wider view that sees a country getting to grips with the pandemic at this point faster than many others around the world. More news on any UK plans to ease back restrictions is expected early next week as the PM said they would finalize a roadmap for a return to normal over the coming days.
Stimulus Push Has Markets Rising
In a rollercoaster week for Wall Street, a further strong voice behind the need for increased stimulus has given the markets a push to end this week on a high. Early trading in the major US markets showed they are looking to recover from the previous negative results as Treasury Secretary Janet Yellen reiterated calls for more government funding with the $1.9 trillion stimulus bill essential.
She also soothed inflation fears by commenting while it is always something to be monitored, she does not believe it to be of great concern noting that a failure to act and provide the required funding boosted could have a much worse economic impact.