Sterling and Euro dipped this morning amidst growing tension between the UK and Europe over the supply and efficacy of the AstraZeneca vaccine.
The UK’s rapid vaccine rollout has benefitted the Pound, seeing it crowned 2021’s best performing currency in the first two weeks of March. But there is growing discontent amongst EU nations regarding the bloc’s lacklustre rollout, which is being partly attributed to a lack of supply of the British-Swedish AstraZeneca vaccine. This adds to tension between the UK and Europe in recent days, with some EU nations suspending rollout of the Astra Zeneca jab amidst health concerns.
One solution being considered by the EU is to restrict exports of the vaccine to the UK in order to bolster supplies; a move that could spark concerns over the UK’s vaccine supply and impact the Pound.
In addition, the UK announced an unemployment rate of 5%, which although better than expected, still saw a leap in jobless claims of 86,500 in February.
Across the pond, the dollar is gaining ground as Federal Reserve Chairman Jerome Powell prepares to testify before Congress this afternoon to shed light on the government’s pandemic relief efforts. President Biden's advisors have also been working on an ambitious $3 trillion infrastructure program to heat up the US economy.
As a result, the GBP/USD hit a 6-week low today after falling one cent this morning. The GBP/EUR trades over 1-cent lower than last week’s highs and the EUR/USD trades towards the bottom of its recent range and under 1.19.