Pound (GBP) Undermined by Brexit Uncertainty
The Pound (GBP) fell for a second consecutive session on Tuesday as a result of continued Brexit uncertainty.
The latest jitters came in response to the EU’s rejection of Boris Johnson’s letter calling for the Irish backstop to be scrapped, further stoking fears the UK faces a potential no-deal Brexit in October.
However, Sterling bounced back later in the session after German Chancellor Angela Merkel suggested the EU will think about practical solutions for the Irish backstop.
Brexit may continue dominating GBP exchange rates for the remainder of the week as Johnson meets with both French President Emmanuel Macron and Germany’s Merkel.
Italy’s Political Turmoil Trims Losses in GBP/EUR Exchange Rate
After stumbling through the morning, the Pound to Euro (GBP/EUR) exchange rate closed yesterday’s session almost flat following the resignation of Italian Prime Minister Giuseppe Conte.
Conte’s resignation deepens the political crisis which has gripped the country in recent weeks, with the threat of a fresh election casting doubts on whether the country will pass its 2020 budget.
In the absence of economic data, we could see Italy’s political woes continue to influence EUR exchange rates today, potentially leaving the Euro vulnerable to losses.
Safe-Haven Demand Drives GBP/USD Exchange Rate Losses
Lingering US-China trade fears led the Pound to US Dollar (GBP/USD) exchange rate lower yesterday as safe-haven demand increased.
While the US administration granted another 90-day reprieve to the ban on Chinese telecom giant Huawei, China’s Foreign Ministry stated it was still dissatisfied by the White House’s treatment of the company.
Coming up today the usually high-impact FOMC minutes could be largely ignored by USD investors as they look to the upcoming Jackson Hole Symposium and a more timely policy assessment from the Federal Reserve.
GBP/CAD Exchange Rate to Rally as Canadian Inflation Slows?
The Pound to Canadian Dollar (GBP/CAD) exchange rate posted modest losses on Tuesday as the oil recovery began to lose steam, limiting the upside in oil-driven CAD exchange rates.
The ‘Loonie’ may struggle to hold on to its modest gains today if domestic inflation slowed as forecast last month.
GBP/AUD Exchange Rate Fluctuates on US-China Trade Concerns
After initially slumping after the minutes from the Reserve Bank of Australia (RBA) offered no dovish surprises, the Pound to Australian Dollar (GBP/AUD) exchange rate bounced back to life yesterday afternoon as the ‘Aussie’ was undermined by persistent US-China trade fears.
GBP/NZD Exchange Rate Steady as Dairy Prices Fall
The Pound to New Zealand Dollar (GBP/NZD) exchange rate closed yesterday’s session virtually unchanged from its opening rate as the appeal of the ‘Kiwi’ was limited by another drop in prices at the latest global dairy auction.