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Pound surges on hopes of Brexit breakthrough

business-articlesPound surges on hopes of Brexit breakthrough
  • Pound leaps as Brexit negotiations intensify
  • Weak German inflation weighs on euro
  • US-China trade talks limit US dollar appeal
 
Fresh Brexit negotiations fuel pound surge
 
GBP exchange rates surged across the board on Friday, spurred on by hopes of a potential breakthrough on Brexit.
 
UK and EU officials started fresh ‘tunnel’ negotiations, sending the pound sharply higher as the odds of a potential deal rose.
 
Although it remains to be seen whether the two sides can reach a mutually agreeable position ahead of the approaching deadline, this failed to prevent the pound’s march higher.
 
However, any indication that talks are stalling once again could see GBP exchange rates reverse their gains in the days ahead.
 
 
Euro under pressure, Eurozone industrial production set to weaken
 
Confirmation that the German consumer price index eased from 1.4% to 1.3% on the year in September kept the euro on a weaker footing.
 
With markets still widely expecting the European Central Bank (ECB) to deliver further policy easing in the months to come, support for EUR exchange rates proved limited.
 
Further losses could be in store for the single currency this morning if August’s Eurozone industrial production data fails to impress.
 
 
Hopes of US-China trade progress dent US dollar
 
Positive signals from US officials encouraged speculation that US-China trade tensions could thaw, leaving the US dollar on the back foot.
 
With market risk appetite picking up demand for the safe-haven US dollar naturally diminished, even as the latest US consumer confidence index bettered expectations.
 
If hopes of a future trade deal fade, however, this could encourage USD exchange rates to recover some of their recent losses.
 
 
Upcoming Data:
 
Monday, 14th October 2019
10:00 EUR Eurozone Industrial Production
 
 
 
Philip McHugh

Philip McHugh

Joining the corporate trading desk in 2007, Phil now over sees all of Currencies Direct’s corporate dealing activity. Having gained experience working with hundreds of businesses to optimise international payments processes and execute comprehensive risk management strategies, Phil currently works with a portfolio of corporate clients whilst managing Currencies Direct’s overall market exposure

Phil has FCA approval and has completed the Certificate in International Treasury Management (CertiTM)

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