Pound Sterling (GBP) Exchange Rate Bounces on Possible offer of UK-Wide Customs Union
The Pound (GBP) rallied in trade on Tuesday, with the UK currency recouping some of Monday’s losses following reports the EU may offer Theresa May the option for a UK-wide customs union.
This is seen as possible solution for avoiding a backstop agreement regarding the Irish border and breaking the current deadlock in Brexit talks, although given that this would require a separate agreement the upside to Sterling proved limited.
Looking ahead, the UK will publish its latest mortgage figures later this morning, potentially dragging on the Pound once again if approvals slowed last month as forecast.
GBP/EUR Exchange Rate Fluctuates as Italy States there is No ‘Plan B’ After Budget Rejection
The Pound Euro (GBP/EUR) exchange rate briefly struck higher during yesterday’s trading session, with the single currency coming under pressure as the European Commission formally rejected Italy’s draft budget.
This resulted in fears of possibly clashes between Rome and Brussels, with Italian Prime Minister Giuseppe Conte fanning the flames of doubt as he told Bloomberg ‘there isn’t any B plan’ regarding the country’s deficit targets.
Things aren’t looking much better for the Euro this morning either, with EUR investors bracing for further losses should the Eurozone’s latest PMI figures continue to highlight the slowdown in the bloc’s private sector.
GBP/USD Exchange Rate Gains Trimmed amid Italy Concerns
The spike in uncertainty following the rejection of Italy’s budget resulted in the Pound US Dollar (GBP/USD) exchange rate closing yesterday’s session virtually unchanged as the ‘Greenback’ was able to offset the rise in Sterling as it fueled demand for safe-haven currencies.
Meanwhile the release of the latest US housing figures could help to buoy the US Dollar today, with another robust expansion in new home sales likely to reflect well on the US currency.
GBP/CAD Exchange Rate Jumps Following Rout in Oil Price
The Pound Canadian Dollar (GBP/CAD) exchange rate leapt around half a cent on Tuesday, with the oil-sensitive ‘Loonie’ struggling to slow Sterling’s advance as it was undermined by a massive 2% slump in crude prices.
However CAD exchange rates aren’t likely to remain under pressure for long, with an expected rate hike from the Bank of Canada (BoC) potentially turbo charging the Canadian Dollar later this afternoon.
GBP/AUD Exchange Rate Slides as Iron Ore Prices Surge
After briefly spiking yesterday afternoon, the Pound Australian Dollar (GBP/AUD) exchange rate fell back again overnight as Australia’s considerable iron ore exports led the ‘Aussie’ to jump as prices for the commodity leapt to new multi-month highs.
GBP/NZD Exchange Rate Range Bound as Risk Appetite Slides
The Pound New Zealand Dollar (GBP/NZD) exchange rate traded in a narrow range on Tuesday, with markets shying away from the ‘Kiwi’ as uncertainty in the Eurozone weakened market risk appetite.