The start of the week was a mostly quiet affair for currency markets besides the Great British Pound which swung around on Brexit headlines but ultimately opens unchanged at 1.3040. Brexit news and rumours continue to move the Sterling with neither side confirming or denying that certain agreements have been all but finalised.
Over the weekend, the Sunday Times claimed that the UK and EU had reached an agreement on the customs union, with the EU conceding a significant concession to allow the UK to avoid a hard border, albeit temporarily. Downing Street was quick to condemn the report however, citing the news as speculation. Nevertheless, the Sterling traded higher on the news as the Greenback failed to find demand ahead of its key mid-term elections.
The relatively strong performance by the Pound was however tempered by a poor reading in the Services PMI report released on Monday. UK Services PMI came well under market expectations and hit its lowest reading since March. This added to other PMI releases around the world with China’s Caixin services PMI also well undershooting expectations. Overall, the data points to a slowing global growth environment as has been widely predicted amidst the US-China trade war.
The Sterling is now set to enjoy a quiet day on the economic calendar. All eyes however will be looking out for Brexit headlines and US mid-term election news for direction.