At 12:15 GMT yesterday, GBPUSD was trading at 1.3477 as speculation and hope grew that a deal in principle had been struck between the UK and EU. Whilst information on this deal is very limited, as always, the market is driven more by certainty and high-level reassurances as opposed to anything granular at this stage. GBPUSD has dropped 1.24% over the last 20 hours and is now trading at 1.3315. GBPEUR rallied to 1.1129 in the same trading period yesterday and is now wearing a 1.13% loss with price back at 1.10 again, which has been a very familiar range over the last 6 months. All GBP currency pairs are lower this morning with a notable spike of 7.7% in the global volatility index, which measures global risk appetite.
The latest “deadline” for Brexit talks has now been shunted to Sunday, but there are already suggestions this could be extended if needed, which is such a familiar situation that I don’t think anyone would be surprised. The markets have been writing about extensions and delays for over four years now, so they are well rehearsed.
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Have a great day.
Author: Alistair Hutson, Senior Relationship Manager
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