Pound falls to one month low as preparations for no-deal are stepped up
Wednesday 9 October, 2019
Daily Currency UpdateGBP - British PoundThe pound fell close to 1.22 vs. the US dollar yesterday amid increased concerns that the UK will be leaving the EU without a deal. The PM and German Chancellor spoke yesterday, the upshot of which being that reaching a withdrawal agreement is impossible if the EU demands N. Ireland remains in the customs union.The pound has recovered this morning, though. A Times report suggests that the EU could be willing to make a major concession by "providing a mechanism for the Northern Irish assembly to leave a new Irish backstop after a set number of years". GBP/USD has jumped 70 points on the news and could well support the quid throughout the European morning session.
Key Moversisk was sold off yesterday as US-China tensions escalated as the US imposed visa restrictions on certain Chinese officials. Safe havens, including the dollar, pushed higher . Meanwhile, US Fed Chair Powell announced yesterday that the Fed will buy more short-term treasuries to bolster the balance sheet, but made it clear it wasn't QE. Nevertheless, it makes for a more interesting FOMC meeting this evening, at which point the bank are expected to announce a cut in interest rates of 25 basis points.
- GBP/USD: 1.2200 - 1.2350 ▲
- GBP/EUR: 1.1100 - 1.1220 ▲