The Pound has benefited from better than forecast UK manufacturing, services and retail sales last week as well as the ongoing vaccine programme and fewer lockdown restrictions. However, increased tension with the EU regarding Northern Ireland could hold the Pound back from making further significant gains.
The Euro has strengthened as Eurozone flash manufacturing and services PMI data beat the market’s expectations on Friday. In addition, the loosening of restrictions in France and Italy has been welcomed by the market.
The market is paying less attention to the escalating virus situation in India and more towards economic recovery from the pandemic. As a result, the Dollar is weaker due to a lack of demand for its safe-haven status.