Read the Beforeitsnews.com story here. Advertise at Before It's News here.
Profile image
By Pound Sterling Forecast (Reporter)
Contributor profile | More stories
Story Views
Now:
Last hour:
Last 24 hours:
Total:

GBPEUR: A Look Ahead to Rishi Sunak’s 2021 Budget

% of readers think this story is Fact. Add your two cents.


The GBPEUR exchange rate is trading near the 1.1400 level after getting a boost from the Bank of England last week. The Threadneedle Street policymakers held interest rates at their record low of 0.1% and refrained from any further stimulus measures in the near future. The bank will now pass the baton to Chancellor Rishi Sunak who will deliver his budget for 2021 on March 4th.

We look ahead to the budget and consider the effects on the pound to euro exchange rate.

Sunak Faces a Tough Task on Current Trends

Rishi Sunak’s second budget since he became Chancellor has been billed as his opportunity to “set out the next phase of the plan to tackle the virus and protect jobs”.

The budget was set to take place in Autumn, but this was scrapped due to the virus pandemic. Sunak’s job will be a tricky one as forecasts have predicted the biggest economic decline for 300 years with the country’s national income set to shrink by 11% in 2020. The Bank of England also said last week that the pre-virus growth levels would come back in March 2022 if the economy opens up as expected.

Government borrowing is also on the rise to its highest level outside of the war era and unemployment is predicted to increase to 2.6 million. The furlough scheme which has supported the unemployment situation will be extended from March until April 2021. More than £46billion has already been paid out in furlough since the scheme began in 2020.

What to Expect From the Budget

The Chancellor was warned this week that raising taxes too early risks could dismantle the fragile recovery. The NIESR think tank were less optimistic than the BoE and saw pre-virus growth retuning in Autumn of 2022.

Sunak also gave businesses in the retail and hospitality sector year-long holiday from business rates, which also expires in April. Lobby groups are now saying that should be extended by another three months, while some are suggesting it should be widened to other sectors.

There will likely be action on VAT as businesses deferred $34 billion of sales but the payments are due on March 31st. On investment and R&D, businesses may also see the relief on the first £200,000 extended to £1 million pounds into the end of 2021.

Sunak has said he will offer a program to replace the Coronavirus Loan Scheme, which provides 80% state backed lending. Firms have tapped this for more than £80 billion of emergency loans, and there have been warnings that a large share will never be repaid.

For the GBP to EUR rate, the budget will expose a lot of cracks in the UK economy and it is the Chancellor’s opportunity to fill as many of those cracks while investors are looking on. If investors are concerned about his response, the Prime Minister may follow the budget with a reopening of the economy in the same month and that will support sterling.

If you have an upcoming currency exchange involving the pound, get in touch using the form below to discuss how these factors could impact your exchange rate.

The post GBPEUR: A Look Ahead to Rishi Sunak’s 2021 Budget appeared first on Pound Sterling Forecast.



Source: https://www.poundsterlingforecast.com/2021/02/gbpeur-a-look-ahead-to-rishi-sunaks-2021-budget/


Before It’s News® is a community of individuals who report on what’s going on around them, from all around the world.

Anyone can join.
Anyone can contribute.
Anyone can become informed about their world.

"United We Stand" Click Here To Create Your Personal Citizen Journalist Account Today, Be Sure To Invite Your Friends.

Please Help Support BeforeitsNews by trying our Natural Health Products below!


Order by Phone at 888-809-8385 or online at https://mitocopper.com M - F 9am to 5pm EST


Order by Phone at 888-809-8385 or online at https://www.herbanomic.com M - F 9am to 5pm EST


Humic & Fulvic Trace Minerals Complex - Nature's most important supplement! Vivid Dreams again!

HNEX HydroNano EXtracellular Water - Improve immune system health and reduce inflammation

Ultimate Clinical Potency Curcumin - Natural pain relief, reduce inflammation and so much more.

MitoCopper - Bioavailable Copper destroys pathogens and gives you more energy. (See Blood Video)
Oxy Powder - Natural Colon Cleanser!  Cleans out toxic buildup with oxygen! 
Nascent Iodine - Promotes detoxification, mental focus and thyroid health.
Smart Meter Cover -  Reduces Smart Meter radiation by 96%!  (See Video)

Immusist Beverage Concentrate - Proprietary blend, formulated to reduce inflammation while hydrating and oxygenating the cells.

Report abuse
Loading...

    Comments

    Your Comments
    Question   Razz  Sad   Evil  Exclaim  Smile  Redface  Biggrin  Surprised  Eek   Confused   Cool  LOL   Mad   Twisted  Rolleyes   Wink  Idea  Arrow  Neutral  Cry   Mr. Green

    MOST RECENT
    Load more ...

    SignUp

    Login

    Newsletter

    Email this story
    Email this story

    If you really want to ban this commenter, please write down the reason:

    If you really want to disable all recommended stories, click on OK button. After that, you will be redirect to your options page.