The EURGBP exchange rate was lower on Tuesday and the pair is now edging closer to a retest of the yearly lows set in April. The pound got a boost from news that the EU had halted its legal efforts against the UK over the Northern Ireland trade protocol, while Britain also saw a seventh day of lower virus cases.
The EUR to GBP now trades at 0.8510 with the April lows coming in at 0.8470.
Coronavirus could be “behind us” in September, adviser says
The worst of the pandemic will be “behind us” by September or October, according to the scientist whose modelling led to the first lockdown in Britain.
Professor Neil Ferguson of Imperial College London spoke to the BBC’s Today programme and said that the vaccines had “been huge in reducing the risk of hospitalisation and death”.
“I think I’m positive that by late September, October time, we will be looking back at most of the pandemic,” Ferguson said, adding “we’ll still have Covid with us, we’ll still have people dying from Covid, but we’ll put the bulk of the pandemic behind us.”
The comments came as the UK logged a seventh-straight daily drop in cases. Scotland is also seeing a marked drop in cases. Professor Jason Leitch described how the country’s cases are “dramatically falling”.
“We had five out of the top 10 local authorities in the UK, now we have none in the top 150,” Professor Leitch said.
Another pandemic modeller said schools closing for the summer break is one of the possible reasons why cases are falling across the UK.
Dr Mike Tildesley said he is “cautiously optimistic” about falling cases but only time will tell if the third wave is “turning round”.
German data will dominate the rest of the week
The German economy will see a host of high-level economic releases this week that could dictate the path for the EUR v GBP rate.
Wednesday will see UK mortgage approvals released but German consumer confidence will have a greater effect on the pair. Thursday will then add the unemployment numbers and inflation for Europe’s largest economy, followed by a GDP update on Friday. Eurozone inflation numbers will also be released on the last day of the trading week.
Consumer confidence is expected to be higher but that is not a sure thing after the recent restrictions in the country and a Monday drop in the IFO business sentiment index. Inflation is also expected to surge to 3.3% from 2.3% as the VAT measures implemented during the pandemic expired.
The EURGBP exchange rate has been under steady pressure as the UK reopens and sees a surprising fall in cases. That is in contrast to the EU, where a hoped for return to tourism in the continent has been stalled by new restrictions.