The GBP had a day of two halves on Wednesday in the Northern Hemisphere. The overnight session in Asia had been pretty quiet, but in London trading the GBP moved sharply higher once stops were hit around last Friday’s intra-day high of 1.3390. GBP/USD reached a best level of 1.3425 before giving back almost all of the gains in the North American time zone.
For many people in the UK, the best part of the festive break between Christmas and New Year is the absence of Brexit negotiations. The seemingly interminable rows between Government and Opposition parties have been temporarily suspended, whilst talks between the EU and European Union don’t restart for several weeks. That said, the Chancellor is being pressed to publish documents after he told the Treasury select committee earlier this month that the government had “modelled and analysed a wide range of potential alternative structures between the European Union and the United Kingdom”.
It is to be hoped any documents are more informative than the so-called sectoral studies which the Minister for Exiting the European Union published just before Christmas. As economic analysis, they were utterly useless. For comedy value, they were wonderful. On fishing, for example, we learned that, “As an island nation, the UK has been dependent on the sea for its trade and defence throughout history, and strong traditions of seafaring can be traced back hundreds of years… There is a concentration of activity in coastal towns.”
We’ll leave our readers to reflect upon this insight, and to wonder where else, other than coastal towns, a fishing industry might be based…
The GBP opens in Asia this morning at USD1.3395 with GBP/AUD at 1.7225 and GBP/NZD1.8970.