The Pound has stayed strong against the Euro and made further gains against the Dollar. However, the market is monitoring the escalating UK-EU tensions with Brexit Minister Frost saying that the UK would defend ‘vigorously’ against any legal action from the EU.
The ECB interest rate decision is due at 12:45pm followed by a press conference. It is unlikely that the central bank will make any changes but the market will pay attention to any comments about inflation and bond yields. Overall, the Euro remains under pressure.
The House of Representatives have approved the $1.9tn stimulus package and is ready to be signed by President Biden on Friday. As a result, the Dollar has weakened due to a risk-on approach being taken by the market.