The Pound Euro (GBP/EUR) exchange rate has weakened this morning on the back of concerns over the Indian variant of coronavirus.
At the time of writing the GBP/EUR pairing are trading around the 1.15 level as a lack of notable data leaves GBP open to losses.
Pound (GBP) Weakens on Indian Variant Coronavirus Worries
The Pound has founding itself weakening against the Euro this morning as concerns over the Indian variant of coronavirus continue to limit Sterling sentiment.
Prime Minister Boris Johnson has come under increasing pressure to delay the UK’s lockdown easing on the 21st of June as cases of the variant increase.
Despite over 60 million doses of the coronavirus vaccine being administered across the UK, Professor Ravi Gupta, a member of the New and Emerging Respiratory Virus Threats Advisory Group (Nervtag) urged the Prime Minister to reconsider lockdown easing measures.
Speaking to UK television this morning Professor Ravi Gupta said:
‘A single dose [of the vaccine] is not particularly protective and that’s the situation that many adults find themselves in during a period of easing of restrictions.’
‘It is something to worry about in the longer term because … we are opening up and I think that we need to seriously reconsider the pathway to full opening if we want to realise the benefits of vaccines fully.’
Euro (EUR) Supported by Eurozone Vaccine Rollout
The Euro has found support against the Pound this morning following the ramped up vaccine rollout across the Eurozone.
Weekly official coronavirus cases in Europe have fallen by almost 60% in the last month, the WHO regional director, Hans Kluge reported last week.
The regional director remained cautious surrounding the bloc’s recovery however saying:
‘The pandemic is not over yet. Increased mobility and interactions may lead to more transmission … In the face of a continued threat and new uncertainty we need to exercise caution and rethink or avoid international travel.’
Pound Euro Exchange Rate Outlook: Coronavirus Developments in Focus
In absence of any notable data, Pound investors will instead be focusing on any further coronavirus developments in the coming days.
Any indication that the Indian variant of the virus looks to dampen the UK’s lockdown easing in the coming month could see GBP weaken against many of its major rivals.
For Euro traders, tomorrow will see the release of German GDP growth rate data for Q1 along with the latest Ifo business climate for May.
Whilst the latest GDP growth rate is expected to show that the German economy contracted by 1.7% during the first quarter, this could be offset by a rise in the business climate.