GBP/USD: Poised to refresh yearly top as UK eyes to ease virus-led restrictions
- GBP/USD takes the bids around mid-1.3800s, keeps Friday’s upside momentum.
- UK PM Johnson signaled easing lockdown measures on completion of vaccination targets, ministers eye March 08 as the date.
- Friday’s upbeat UK GDP, Britain’s strong vaccine drive and US dollar weakness also favor the bulls.
GBP/USD stays bid around 1.3855 during the early Asian session on Monday. In doing so, the cable buyers keep Friday’s upside momentum that refreshed the yearly top while rising towards the 1.3900 threshold.
Although upbeat prints of the UK’s Q4 GDP, 1.0% versus 0.5% forecast, offered strength to the GBP/USD prices late in the last week, the recent upside moves take clues from chatters of easing virus-led lockdowns in Britain.
On Sunday, UK PM Boris Johnson hailed, per Reuters, the success of Britain’s vaccine program after data showed 15 million first doses had been delivered. In doing so, the national leader also teased easing the coronavirus (COVID-19)-led lockdown measures. Following that the UK’s Telegraph came out with the news suggesting the ministers are looking to begin lifting restrictions from March 8.
Also supporting the GBP/USD bulls could be the US dollar weakness. The greenback has been bearing the burden of equity rally and a jump in the treasury yields amid hopes of stimulus and positive news on the covid vaccine front. It’s worth mentioning that the expectations of a future rise in inflation and statements/data conveying the present weakness of the US employment sector also weigh on the USD.
Moving on, an absence of any major data/event in Asia, coupled with off in China, precedes a light calendar in the UK and the US holiday to challenge the pair’s further upside. However, bears will be cautious before taking entries unless the US dollar witness short-covering moves amid an inactive day.
Technical analysis
Unless declining below January’s top near 1.3760-55, GBP/USD bulls are less likely to step back.