Pound Climbs As Omicron Worries Lessen

The pound climbed against its major opponents in the European session on Wednesday, as investors looked past a spike in Omicron cases across the globe.

South African scientists released a study showing that infection with the Omicron variant boosts immunity against the Delta strain.

The study showed that immunity to subsequent infections from the new strain rose 14-fold after being infected. It also suggested that the likelihood of reinfections with Delta will be limited among those infected with Omicron.

The rapid spread of the Omicron could lead to more hospitalizations, particularly among unvaccinated groups, and cause widespread disruption to health systems and other critical services, WHO Europe's Covid Incident Manager Catherine Smallwood warned.

France, UK, Italy, Greece, Portugal and Cyprus all reported record daily infections on Tuesday.

The pound reversed from its prior lows of 154.05 against the yen and 0.8423 against the euro and edged higher to 154.45 and 0.8403, respectively. The pound may locate resistance around 157.00 against the yen and 0.82 against the euro.

The pound rose to 1.2345 against the franc and 1.3438 against the greenback, following its early low of 1.2306 and a 2-day low of 1.3408, respectively. On the upside, 1.26 and 1.37 are likely seen as the next resistance levels for the pound against the franc and the greenback, respectively.

Looking ahead, U.S. pending home sales, wholesale inventories and advance goods trade balance for November will be out in the New York session.