Germany Cuts Growth Forecast, UK Enforces Border Controls

27 January 2021 | Updated: 27 January 2021

The dollar, yen, and Swiss franc have strengthened again today as the fall in European stocks weakened. The mood is somewhat softened by the UK plan to introduce stricter border measures.

Germany has cut its growth forecasts for this year. Commodity currencies declined in line with the general risk sentiment.
The German government cut its growth forecast for 2021 to 3%, sharply below last fall’s forecast of 4.4% due to the second round of coronavirus isolation.

Gfk consumer confidence in Germany fell to -15.6 in February from -7.5, well below the -7.8 forecast. In January, economic expectations fell from 4.4 to 1.3. Income expectations fell from 3.6 to -2.9. The propensity to buy plummeted from 36.6 to 0.0.

Rolf Bürkl, GfK Consumer Expert: “In the first quarter of this year, consumer sentiment faced serious challenges. For sustained recovery, infection rates must drop more than they are today so that interventions can be significantly reduced. This means we need to wait a bit before we see the recovery that many were hoping for this year. ”
UK Enforces Border Controls
British Prime Minister Boris Johnson said Wednesday that ministers will announce new, tougher border measures on the same day. Just 10 days before the first isolation from Covid-19 last March, the UK abandoned its short-lived policy of quarantining travelers from hazardous overseas locations.

While other countries have imposed stricter travel restrictions to combat the pandemic, Downing Street did not implement border measures for almost three months before early June. This was a “very unusual” approach, according to a terrifying parliamentary report released last year.

The chatter about British politicians’ push for a complete border closure and the worsening coronavirus (COVID-19) situation in the UK seems to be challenging bulls of late. However, the risk sentiment emanating from the new government in the US is pushing up the quotes.

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Azeez Mustapha

Azeez Mustapha is a trading professional, currency analyst, signals strategist, and funds manager with over ten years of experience within the financial field. As a blogger and finance author, he helps investors understand complex financial concepts, improve their investing skills, and learn how to manage their money.