The Pound reached stability. Overview for 06.01.2021

After a local decline, GBPUSD is reaching stability and trying to keep its positive momentum. 

The British Pound has recovered against the USD on Wednesday after a volatile start of the year. The current quote for the instrument is 1.3635.

Another lockdown in the United Kingdom amid the growing number of COVID-19 cases and new strains of the virus made investors worry early in 2021. Closed cafes, restaurants, shops, and other tertiary industry facilities may have a negative influence on the country’s economy in the future and it does not necessarily mean that the current stimulus measures will be enough to avoid serious slumps. 

On the other hand, this negative influence of the lockdown is somehow compensated by the Brexit procedure, which has been finally completed. A transition period given to the parties for discussing key matters lasted a year but eventually, everything came down to just a couple of days. We’ll see later how successful the 1,200-page agreement between the United Kingdom and the European Union will be. One way or another, London exited the alliance and it will take pretty much time to make a lot of arrangements with neighboring countries.

The statistics published earlier showed that the Mortgage Approvals in November was 105K after being 98K in October and against the expected reading of 82K. The actual reading is positive: at the end of 2020, the mortgage market revived a little bit, thus indicating consumers’ stable attitude towards spending money. However, the indicator may quickly change its direction if the country’s population decided to start saving money and wait for a better economic outlook.