European session review: GBP as investors cheer speedy vaccine rollout in Britain, better-than-expected UK manufacturing PMI

GBP rose against its major rivals in the European session on Monday as a relatively speedy rollout of coronavirus vaccines in the UK bolsters investors' sentiment. 

Official data on Sunday revealed that almost 9 million people in Britain had received their first dose of a Covid-19 vaccine. International Trade Secretary Liz Truss said yesterday that the government was “absolutely confident” it could continue to deliver its vaccination program, even as a dispute over vaccine exports from the EU raised concerns over the provision of supplies of the Pfizer and BioNTech's shot, which is produced in Belgium. The UK intends to offer vaccines to 15 million people by mid-February. 

According to the Financial Times' (FT) Covid-19 vaccine tracker, the UK is among the countries with the highest vaccination rates globally. Israel has a rate of 52.3 vaccination doses per 100 residents, followed by UAE at 34.1 and the UK at 14.2. Overall, at least 96 559 130 doses of coronavirus vaccines have been administered around the world, data from 69 countries show.

The latest report from IHS Markit showed that the UK’s manufacturing sector activity grew more than initially estimated in January. The IHS Markit/CIPS UK Manufacturing PMI was revised sharply higher to 54.1 in January 2021 from a preliminary of 52.9, but below 57.5 in December. A reading above 50 indicates expansion, while a reading below 50 indicates contraction. Economists' had forecast the indicator to remain unrevised at 52.9.

Investors' attention is gradually shifting towards the Bank of England’s (BoE) meeting later this week. The UK's central bank is set to publish its monetary policy statement on Thursday and markets expect it will provide findings of the consultations with banks on what negative rates would mean for lenders’ operations. Most economists do not believe the BoE is likely to cut rates below zero in 2021.