The pound rose once again yesterday but its gains were trimmed as Brexit talks this week have not provided participants with any signs of hope. Sterling’s advancement was moderated a lot more significantly against the US dollar than the euro in what was a volatile session for the British currency.
After rallying towards $1.2660 the pound’s fortunes reversed in the afternoon session to see it close around the $1.26 level. GBPEUR rallied towards the €1.12 handle across the day but its gains were tempered, closing around the €1.1150 mark. Brexit negotiation progress appears limited and the buzz from the recent ‘Summer Statement’ from Mr. Sunak could be fizzling out. In other news, International Trade Secretary, Liz Truss, had a private letter leaked to a business news media outlet. In the letter, the MP raises concerns about the prospects for trading with the EU after the transition period ends on 31st December 2020. The letter builds a case for extending the transition period which is odd as Truss herself, and her governmental colleagues, have all previously flouted the idea of an extension. The pound’s journey from here is an unknown one. Resistance levels are approaching, the following days could be quite telling on whether a reversal or continuation higher is likely.
Today’s economic calendar is once again light, US inflation data as well as Canadian employment numbers will be the main highlights.
Have a great weekend.
Written by Viv Savani. 8:18am, July 10th 2020
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