GBP / USD recovers above 1.40 amid optimism over UK reopening

• GBP / USD is attempting to bounce above 1.40, again targeting multi-year highs.
• The British prime minister’s office says the first step in relaxing the lockdown measures will start on March 8.
• Reflation trading also boosts the riskier sterling.

The GBP/USD moves higher again during the European session on Monday, approaching the 1.4050 level once again to retest the 35-month highs.

The GBP / USD has captured new purchases, rebounding after a brief dip to 1.3981, after the office of UK Prime Minister Boris Johnson announced that the four conditions are met to relax the blocking measures induced by the covid and therefore the government can proceed with the first step of reopening the economy as of March 8.

Meanwhile, Prime Minister Johnson said that “we will establish a roadmap to exit the blockade with caution“, with the top priority of reopening schools.

The UK has gained the upper hand by being the first to act, in terms of covid vaccines and now with approximately 25% of the population vaccinated with the first dose. This factor continues to support sentiment around the British pound.

The reflation trade in the middle of the vaccine optimism and encouragement continues to benefit the riskier British pound against the US dollar, as investors They ignore latest Telegraph report highlighting looming Brexit risks.

Markets remain focused on reflation trading, awaiting further updates on a potential US stimulus deal.

The highlight of the day remains British Prime Minister Johnson’s speech, in which he is expected to outline the path out of the blockade.

GBP / USD technical levels