British pound plunges to 12-month low with 'Plan B'
Following a public announcement of new restrictions against COVID in the UK, the GBP fell on Wednesday.
The new package of measures known in the UK as Plan B includes the introduction of the vaccine passport system, compulsory face masks in certain social settings, and a request for everyone who can to work from home. Faced with new pandemic challenges, the British pound plunged to a 12-month low.
Early on Thursday the GBP dropped to 1.3161, its lowest level since December 2020 in a "Plan B selloff" against the USD.
The new social restrictions are likely to hit businesses who had just started to recover from this year's lockdowns. Analysts now believe that the latest developments will stop the Bank of England from raising rates on December 16. Until last month, it was expected that the BoE would raise its interest rates in the "coming months" as a way to deal with high inflation. The latest developments however are creating a new wave of uncertainty.
The GBP is likely to remain vulnerable to domestic Covid developments and Brexit headlines.
The new package of measures known in the UK as Plan B includes the introduction of the vaccine passport system, compulsory face masks in certain social settings, and a request for everyone who can to work from home. Faced with new pandemic challenges, the British pound plunged to a 12-month low.
Early on Thursday the GBP dropped to 1.3161, its lowest level since December 2020 in a "Plan B selloff" against the USD.
The new social restrictions are likely to hit businesses who had just started to recover from this year's lockdowns. Analysts now believe that the latest developments will stop the Bank of England from raising rates on December 16. Until last month, it was expected that the BoE would raise its interest rates in the "coming months" as a way to deal with high inflation. The latest developments however are creating a new wave of uncertainty.
The GBP is likely to remain vulnerable to domestic Covid developments and Brexit headlines.
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