In today's episode our financial expert Adrian Lawrence talks about the Pound's foreign exchange rate, which has been rising over recent weeks. There is growing optimism in the UK economy as the vaccination roll out program is on target with more than 15 million people now vaccinated, which means it is now more likely that the lockdown of retail, leisure and hospitality can end.
The other significant factor in the exchange rate was Brexit where the uncertainty was lifted before the end of 2020 when the UK reach a withdrawl agreement with the EU.
The UK looks to be able to recover faster than the EU whose vaccination program is proceeding at a far slower rate.
The exchange rate is now £1 to $1.38 with market expections of a return to the long term average rate of $1.45. The rate against the Euro has also improved to around £1 to Euro1.14.
This is positive news story as it shows there is renewed positivity about the UK economy.
Financial markets price in future events to their current prices, and the exchange rate is rising because the market expects the UK economy to recover and grow faster than others, and there is now less uncertainty around growth prospects that for the EU.
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