Concerns flashed on investors ’faces for the pound, after the currency displayed volatile movements as the European trading session began.
This was driven by the rise in the greenback dollar, following a 10 -year increase in US treasury yields that bounced back to 1.6% after falling to a low of almost two months earlier.
However, after declining almost to the price level of 1.37000, the pound returned to climb and almost wiped out the losses recorded at the beginning of the session.
While the main factor to its decline was due to the appreciation of the US dollar, on the other hand, the UK is currently facing pressure in its relations with the European Union (EU).
As the meeting between the UK-EU chief Brexit negotiators took place on Thursday, David Frost of the UK said that discussions on the Northern Ireland protocol had seen some positive momentum, but problems remained.
Meanwhile, vaccination efforts in the UK are likely to be affected after the country signals about the supply of vaccines, where the number of first doses may be limited.
Even more so with the delay in vaccine delivery by Johnson & Johnson due to the side effects of blood clots experienced by recipients.
These factors have prevented the pound from rising higher above the $ 1.38000 price this week.
