The GBP/USD pair rallied over 50 pips during the early European session and climbed to two-week tops, around the 1.3865-70 region in the last hour. As investors looked past Friday's blockbuster US NFP report, the prevalent risk-on mood capped the upside for the safe-haven US dollar and provided a modest lift to the GBP/USD pair. The British pound was further supported by the highly successful vaccination distribution program and the gradual reopening of the UK economy.
The uptick could further be attributed to some repositioning trade ahead of the UK Prime Minister Boris Johnson's announcement on the second phase of easing lockdown restrictions. This would allow non-essential shops, pubs and restaurants, hairdressers and nail salons to open starting from April 12 and the potential to reopen foreign travel. That said, a combination of factors might continue to underpin the greenback and keep a lid on any further gains for the GBP/USD pair. Investors remain optimistic about the prospects for a relatively faster US economic recovery from the pandemic, bolstered by the Biden administration's planned stimulus of more than $2 trillion.