The Pound has strengthened against both the Euro and Dollar as news that Prime Minister Johnson has left hospital on Sunday was welcomed by the market, choosing to ignore Chancellor Sunak’s comments that economic growth could shrink by up to 30%.

Parliament is due to reopen virtually next week in order to pass its Finance Bill, which will formally introduce measures laid out in the most recent Budget. On Thursday, Foreign Secretary Raab is expected to announce an extension to current restrictions for a further 3 weeks.

Although the Euro remains under pressure, there are some encouraging signs as Germany has seen a decrease in the number of daily cases whilst Spain have brought back most non-essential workers with new requirements to wear face masks. France have extended their lockdown until 11th May, with plans to gradually reopen whilst testing every citizen for COVID-19. French finance minister Le Maire believes that their economy will contract by 8% this year.

The Dollar lost some ground on Friday as consumer price inflation data came out worse than expected at-0.4%.

FOMC member Bostic struck an optimistic tone during a recent interview, suggesting that the economic recovery from the coronavirus will be much more robust compared to typical recessions. In addition, news that China has approved three vaccines for clinical trials led to the market taking a more risk-on approach which in turn led to Dollar weakness.