The cable is under 1.32, the first time since last December!
UK and coronavirus had interesting stories these days for media. While Prime Minister Boris Johnson for a week was denying the holding of any party last Christmas, finally, he apologized for that and recorded another negative point in this regard for himself and his administration.
On the other hand, with increasing new infected the British government announced new restrictions to reduce the possibility of a new wave of infections caused by the highly-spread Omicron virus. So now, the UK is one of the first countries that take a step forward against the fast-spreading of the Omicron variant of coronavirus. The pandemic situation in the UK worsening again. New daily cases exceeded 47,000, in seven days' average, breaking the record of more than 46,000 cases in July and October this year. It also set the second peak since the outbreak of the pandemic has started. At the end of November, the total number of coronavirus cases in the UK has exceeded 10 million. Total death also has exceeded 145,000 till now.
According to the new epidemic prevention announced by Prime Minister Johnson, the government is encouraging relaunching the home office and accelerating vaccination intensification, with the compulsory wearing of masks in public places, and presenting vaccination certificates. For traveling, now, the UK requires all foreign travelers to undergo nucleic PCR testing on the second day of entry and to maintain self-isolation before the result is negative. In addition, close contacts with Omicron patients will also be required to self-isolate for up to 10 days.
Yesterday and right after the report, the pound fell to the new low against USD since December 2020 at 1.3160 against the US dollar. At the same time, the yield on the 10-year British government bond fell to 0.68%, which is the lowest level since September 6. Next week, the Bank of England interest rate decision and monetary policy meeting will be in the spotlight. However, now and with this announcement of tightening of epidemic prevention measures, the market participants can not count on rate hike!
From the technical point of view also, the current downtrend under the key level of 1.3225 is more likely. With RSI at 45 and decreasing the OBV trend line, the current downtrend is confirmed. The following targets sit at 1.3167 and 1.3140.
