The GBP/USD has remained bullish for the better part of Tuesday’s trading session as UK Prime Minister, Boris Johnson is reportedly taken to intensive care as his health deteriorated due to the coronavirus.
Johnson’s health condition worsened on Monday, warranting his admission into intensive care on the directive of his medical team. The British Prime Minister has fallen victim to the coronavirus which is currently a global pandemic. Some expected Boris’s admission into the ICU to cause panic into the market, thus affecting the Pound Sterling’s performance. That might have been the case on Monday when the GBP/USD currency pair dipped from around 1.2319 on Friday evening to the day’s low at 1.2165.
Tuesday’s performance however indicates a strong recovery in the Pound Sterling as evident by the bullish performance. The currency pair surged from the Tuesday morning’s low at 1.2218 to a high of 1.2372 at the time of this press. A situation such as Johnson’s hospitalization is enough to warrant a reaction of some sort from the market. Even Brown Brothers Harriman forex analyst Ilan Solot believes so judging by his statement. Solot noted that some complications will arise if the UK Prime Minister fails to resume his duties.
The impact of the Prime Minister’s leadership in the UK on the Pound Sterling’s performance was demonstrated by the Brexit situation in 2019. Especially when Theresa May stepped down and Johnson was elected. Meanwhile, Johnson’s government also found itself under scrutiny for not implementing adequate measures to help curb the spread of the coronavirus.
The UK is currently one of the countries that have largely been affected by COVID-19 pandemic although some other countries have had it worse. This has certainly affected the performance of the UK’s economy and subsequently affected the GBP’s performance. On the other hand, the Pound is also gaining over the U.S dollar which has grown slightly weaker this week on account of the slowing U.S economy due to the coronavirus. This translates to Tuesday’s surge on the GBP/USD currency pair.