Pound (GBP) Rocked by Brexit Headlines
The Pound (GBP) traded in a wide range yesterday, initially coming under pressure as the Democratic Unionist Party (DUP) were vocal in their opposition of a draft Brexit deal which proposes a customs border in the Irish Sea.
But market optimism soon returned and saw Sterling climb to new multi-month highs as the EU’s Chief Brexit Negotiator, Michel Barnier said he was ‘optimistic’ a deal could still be done.
However, with the DUP refusing to play ball, a Brexit deal hangs in the balance this morning and the Pound faces fresh pressure.
As Boris Johnson races to salvage talks ahead of a crunch EU summit later in the day, could we finally see an agreement emerge and fears for a no-deal permanently laid to rest?
GBP/EUR Exchange Rate Accelerates as Eurozone Inflation Disappoints
The Pound Euro (GBP/EUR) exchange rate continued to march higher on Wednesday, with the single currency struggling to put up a fight after the Eurozone’s final consumer price index (CPI) for September saw headline inflation revised down to just 0.8%.
This is the worst level since November 2016 and even further below the European Central Bank’s target rate of 2%, which now seems wildly optimistic.
EUR investors are likely to focus on Brexit today, with a positive outcome also likely to reflect well on the Euro in broader trade. The EU summit later today will also step into the spotlight, with European Central Bank (ECB) policymakers sure to comment on the bloc’s economic outlook.
GBP/USD Exchange Rate Soars on Lacklustre US Retail Sales
The Pound to US Dollar (GBP/USD) exchange rate leapt to a five-month high during yesterday’s European session after a shock contraction in US retail sales during September.
As a solitary ray of light in the face of increasingly gloomy US data, consumer spending finally faltered last month, undermining USD and placing even more pressure on the Federal Reserve to cut interest rates.
The US Dollar faces an uphill struggle again today, with US industrial data predicted to report a contraction in factory production last month.
GBP/CAD Exchange Rate Surges as Canadian Inflation Misses
The Pound to Canadian Dollar (GBP/CAD) exchange rate jumped over a cent in the mid-week after domestic inflation underperformed in September, leaving the ‘Loonie’ vulnerable.
GBP/AUD Exchange Rate Retreats as Australian Unemployment Drops
The Pound to Australian Dollar (GBP/AUD) exchange rate fell back from a three-year high overnight on Wednesday, as the ‘Aussie’ was buoyed by a surprisingly upbeat domestic jobs report, with unemployment unexpectedly sliding to 5.2% in September.
GBP/NZD Exchange Rate Rockets on RBNZ Speculation
The Pound to New Zealand Dollar (GBP/NZD) exchange rate roared higher on Wednesday, with investors dumping the ‘Kiwi’ amidst speculation that the Reserve Bank of New Zealand (RBNZ) will cut rates again next month, despite strong domestic inflation in the third quarter.