After lacking direction through Monday’s session, the pound may experience more significant movement today on the latest UK jobs data.
Negotiations regarding the Northern Ireland protocol remain deadlocked and European Commission vice-president Maroš Šefčovič, warning that these talks will ‘probably’ drag into next year, something which will lead to prolonged uncertainty for GBP investors.
In addition, a row between the UK and France over migrants crossing Channel, also cast a shadow over ongoing talks.
Last week's Brexit concerns almost entirely overshadowed the release of some broadly positive UK economic data, with November's preliminary PMIs and latest CBI distributive trades and industrial orders indexes all printing above forecast, but failing to offer much in the way of support to the pound.
The emergence of the omicron variant of Covid then prompted some volatility in Sterling at the end of last week, amidst fears it could deter the Bank of England (BoE) from pursuing a December rate hike.
Turing to this week, a fairly empty UK data calendar will likely see the direction of the pound primarily driven by Brexit developments and Covid headlines.
So far this has resulted in some weakness in Sterling as the UK reintroduces some restrictions amidst concerns over the omicron variant.
Should there be any hint that stricter restrictions may be needed then the pound could face an uphill battle this week.
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)