GBP/USD holds 1.3900 despite fears of UK’s vaccine shortage
- GBP/USD fades recovery moves from intraday low of 1.3892.
- US dollar eases as bond bears catch a breather.
- Fears of cut in vaccine supply in the UK, Brexit jitters battles one-year high consumer morale in Britain.
- Sino-American tussles, Treasury moves can offer short-term direction.
GBP/USD fizzles bounce off the day’s low while easing to 1.3915 ahead of Friday’s London open. Although fears of vaccine shortage in the UK seem to test the cable, US dollar weakness tames the bears for now. Given the lack of major data/events, risk catalysts are the key to observe.
Sky News spots a letter from the National Health Services (NHS) England while saying, “The UK is going to face a "significant reduction" in coronavirus vaccine supplies from 29 March, for an estimated four-week period.” Though, UK’s Health Secretary Matt Hancock said, per the Sky News, that the vaccine supplies are always lumpy.
Not only the likely shortage in the UK’s vaccine supply but a study from the University of Warwick, suggesting Vaccinations alone are unlikely to contain coronavirus infections in the UK, also weigh warn the cable bulls. Even so, UK PM Boris Johnson sticks to the unlock plans while also defending AstraZeneca’s vaccine.
Elsewhere, the European Medicines Authority (EMA) said the vaccine is safe and the World Health Organization is on the road to repeat this statement on Friday.
Brexit jitters continue over the Northern Ireland (NI) Protocol whereas the US and China also squabbled in Alaska and tried to weigh on the market sentiment.
However, the US Treasury yields’ pullback seems to favor the stock futures by the press time. Also on the positive side could be the UK’s March consumer sentiment gauge from GfK that printed a one-year high recently. It should be noted that the Bank of England (BOE) stays optimistic during its monetary policy meeting on Thursday.
Considering a light calendar ahead, vaccines and updates from Alaska are likely to entertain GBP/USD traders.
Technical analysis
A sustained pullback from the horizontal area comprising multiple tops, marked since March 01, joins the downward sloping RSI line on the four-hour chart to keep GBP/USD sellers hopeful.