European session review: GBP mostly lower, weighed down by EU-UK vaccine export row

GBP fell against most of its major counterparts in the European session on Tuesday as a spat between the European Union (UK) and the UK over exports of AstraZeneca's coronavirus vaccine aggravated.

The bloc threatened to ban exports of AstraZeneca's vaccines, coming from its plants in the European Union to other countries if the drugmaker does not meet its delivery obligations. 

AstraZeneca reduced the number of vaccines it will deliver to the EU twice in the first quarter and once in the second quarter, raising worries that any future issues could undermine vaccination targets of the European authorities.

European Commission President Ursula von der Leyen stated: “We have the possibility to forbid planned exports. That is the message to AstraZeneca, ‘you fulfil your contract with Europe before you start delivering to other countries’.”

The EU leaders will meet on Thursday to decide whether or not to block vaccine exports. The EU fell far behind Britain and the U.S. in rolling out COVID-19  vaccines. 

An export ban by the EU could slow the UK's vaccination program. UK Defense Secretary Ben Wallace said on Sunday that attempts to block exports of AstraZeneca's vaccine from the EU would be "counterproductive" and the "grown-up thing" would be to work with the UK to maximize production. On Monday, Britain demanded that the EU allow the delivery of coronavirus vaccines it has ordered.