The pound sterling trade faces two major risks this week, with the Bank of England (BOE) policy meeting and Scottish parliamentary elections set to take place on Thursday.
Ahead of the announcement of monetary policy by the BOE, there are some analysts who predict that the central bank will make a reduction in its bond purchases.
This follows progress in vaccine launches in the country which has prompted a number of restrictive measures to be gradually eased.
UK Prime Minister Boris Johnson had previously reported that the 1 -meter jail rule was likely to end on June 21 in England, while also proposing the ‘opening’ of foreign travel on May 17.
However, there is also an expectation that the central bank will remain with the current monetary policy approach as uncertainty about the global recovery remains high, especially with the surge in the Covid-19 case in India.
Meanwhile, the Scottish National Party (SNP) is expected to gain a majority in the Scottish parliament, which some see as a risk for Britain.
The SNP has promised to call for Scotland’s second independence referendum, although permission to do so will have to be given by the UK government in London.
In the European session, the movement of the pound was seen to be somewhat limited as investors took cautious measures ahead of two important events this week, as well as being affected by the rise in the US dollar.
