Pound (GBP) Subdued as EU Casts Doubt on Brexit Progress
Following Friday’s surge, fading Brexit optimism saw the Pound (GBP) relinquish ground as the week’s session got underway.
In a meeting between Boris Johnson and Jean-Claude Juncker, the European Commission President said he was still waiting for the UK to present a workable solution to the Irish backstop.
With no economic data inbound, Brexit sentiment will continue to drive GBP exchange rates through Tuesday’s session. Today’s Supreme Court hearing, in which Boris Johnson’s suspension of parliament will come under scrutiny, could potentially cause Sterling volatility.
GBP/EUR Exchange Rate Steady amid Trade Concerns
The Pound Euro (GBP/EUR) exchange rate was rangebound on Monday as the potential threat of a looming US-EU trade war unnerved Euro (EUR) investors.
The World Trade Organization (WTO) ruled against the EU in a case over illegal subsidies for European aviation giant Airbus, stoking fears Washington may turn its ire on the EU, even as the US and China approach a deal.
Coming up this morning, the Eurozone’s latest economic sentiment index could cast the Euro lower if the ZEW survey reveals sentiment in the bloc remained in the doldrums this month.
GBP/USD Exchange Rate Slumps as Geopolitical Tensions Rise
The Pound to US Dollar (GBP/USD) exchange rate slumped yesterday, with investors flocking to the safe-haven US Dollar (USD) as geopolitical tensions flared.
This followed drone attacks on Saudi oil facilities over the weekend, with US intelligence pinning the blame on Iran and Donald Trump warning of possible military action.
Looking ahead, any additional movement in the ‘Greenback’ could be limited today as markets brace for an expected Federal Reserve rate cut on Wednesday.
GBP/CAD Exchange Rate Plummets on Surging Oil Prices
The Pound to Canadian Dollar (GBP/CAD) exchange rate plummeted as much as 0.8% on Monday in response to surging oil prices which jumped over 12% at the opening of the week.
This followed the explosive drone attack on Saudi Arabian oil fields which saw Brent crude climbing over $67 a barrel and underpinned demand for the oil-sensitive Canadian Dollar (CAD).
GBP/AUD Exchange Rate Rallies on Dovish RBA Minutes
The Pound to Australian Dollar (GBP/AUD) exchange rate jumped over half a cent overnight on Monday. Demand for the Australian Dollar (AUD) slumped as the Reserve Bank of Australia (RBA) minutes revealed an appetite for further monetary easing from policymakers.
GBP/NZD Exchange Rate Strengthens as Risk Appetite Deteriorates
The Pound to New Zealand Dollar (GBP/NZD) exchange rate also ticked higher overnight, with investors shying away from the risk-sensitive New Zealand Dollar (NZD) as geopolitical tensions increased.