Coronavirus continues to prove a barometer for sterling’s movements.
The success of the UK’s vaccine rollout has done much to boost GBP.
George Vessey UK Currency Strategist for Western Union Business Solutions has shared his insight on how the vaccine rate across Europe has impacted the exchange rate.
“As market participants continue to follow rising infections and restrictions in Europe potentially disrupting the UK’s recovery roadmap, recent tensions regarding access to coronavirus vaccinations have also been on the radar and negatively impacted risk sentiment,” he explained.
“However, on Wednesday night both the UK and EU moved to calm the building tensions ahead of today’s European Council meeting on the subject.”
“From a market perspective, if Europe gets hold of more vaccines and the UK’s access is blocked, this could be deemed Euro-positive.”
Vessey added: “GBP/EUR has slipped from 13-month highs and is on track for its largest weekly fall in 2021.”
So what does this mean for your holidays and travel money?
While it may be tempting to buy holiday money while rates are good, it is inadvisable to buy them while there’s still so much uncertainty over foreign travel this summer.
Travel abroad is currently illegal with sizeable fines coming into force from Monday for those who jet off without “reasonable excuse.”
What’s more, quarantine and Covid tests are mandatory upon arriving in the UK.
Experts advise waiting until any volatility simmers down.
“However, I would advise against this. Market movements are often more marginal in reality than they appear.
“Especially during this volatile time, it’s safer to keep hold of your money in your UK bank account than purchasing or exchanging for holiday money.
“Once we are allowed to travel again, this will signify the end of the COVID bump and I anticipate this will mean the Pound has improved even more significantly.
“On top of this, when it comes to your consumer rights, using a travel card will always be a safer and cheaper option than using cash.”