8th November 2018-Sterling gained further underlying support from expectations that a Brexit deal was close to being agreed

 
     

Sterling gained further underlying support from expectations that a Brexit deal was close to being agreed

US equities rallied strongly after the Congressional election which helped underpin global bourses while bond yields recovered from an initial dip to trade slightly higher.

After sharp losses ahead of the New York open on reduced expectations of further fiscal support, the dollar regained ground as Wall Street equities advanced.

Despite pressure for profit taking, Sterling gained further underlying support from expectations that a Brexit deal was close to being agreed.

Oil prices remained under pressure and slid to fresh 7-month lows after another sharp weekly inventory build.

Gold was unable to make headway amid robust risk appetite.

Sterling gained initial support on Wednesday from further rumours that negotiators were close to reaching a deal. The currency was, however, vulnerable to a correction after recent gains with a GBP/USD retreat from a 3-week peak near 1.3175 and GBP/EUR rallied back through the key 0.8720 level which encouraged profit taking on long Sterling positions.

EU Chief Negotiator Barnier stated that Brexit talks with the UK remained intensive and that there could be no deal without an Irish backstop being in place. Sources also suggested that a breakthrough was needed this week or early next week in order to arrange a special Summit in November. Reports late in Europe suggested that a Cabinet meeting would probably be held early next week with Ministers having access to the draft withdrawal agreement beforehand.

Overall Sterling sentiment held firm with underlying short covering still a significant feature and EUR/GBP retreated again at the European close with fresh 4-month lows near 0.8700.

The RICS house-price index recorded the weakest reading for 6 years as uncertainty undermined the sector, especially around London, but markets remained focussed on political developments and GBP/USD drifted to near 1.3100 as the US currency rallied.

     
 
       
 

GBP/EUR 

– 1.1475
 
 

GBP/USD

– 1.3120

 
 

GBP/CHF 

– 1.3142

 
 

GBP/JPY 

– 149.17

 
 

GBP/AUD 

– 1.8002

 
 

GBP/NZD 

– 1.9331

 
 

GBPCAD

– 1.7196

 
 

GBP/ZAR 

– 18.3238

 
 

GBP/NOK 

– 10.9378

 
 

GBP/SEK 

– 11.8225

 
 

EUR/USD 

– 1.1433

 
       
  All rates are indicative of interbank rates*  
       
 
 

GBP/EUR

 
 

GBP/USD 

 
 

EUR/USD 

 
       
 
   

09:00 EUR

ECB Economic Bulletin

-

-

 
   

13:30 USD

US Initial Jobless Claims

215K

214K

 
   

19:00 USD

FOMC Interest Rate Decision

2.25%

2.25%

 
   

19:00 USD

FOMC Statement

-

-

 
 
   
 
 
*All rates shown are indicative of interbank rates and should only be used for indication purposes only. It is important to note that foreign exchange rates fluctuate and that rates may vary depending on the amount and the base currency that is purchased or sold. Rates are correct as of 8:00am UK time.  CentralFX are not responsible for the rates shown.
 
 
 

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