GBP>EUR – 1.1576
GBP>USD – 1.3101
EUR>USD – 1.1318
GBP>CAD – 1.7468
GBP>AUD – 1.8277
GBP>SEK – 12.122
GBP>AED – 4.8104
GBP>ZAR – 18.250
|This Week’s Calendar|
The Week Ahead
- China Q1 GDP Eyed
- Inflation data to dominate elsewhere
- GBP Buyers target 4-Wk old resistance-lines.
- USA Economic activity indicators in focus.
The Pound has been trading mixed and what could be best described as neutrally on the net. The extension of the Brexit process, with its October-31 deadline, has taken Brexit off the “of-immediate-concern” list with the UK having for now avoided a disorderly no-deal exit from the EU. The extra time will buy time for the public mood to have an impact on proceedings. Although the country remains divided on Brexit, a movement calling for another referendum on EU membership appears to be gaining ground. The nearer term focus will be on efforts by the government and Labour to find a comprise around the existing Withdrawal Agreement, which Labour want to be attached with a commitment for the UK to remain in the EU customs union in the post-Brexit future. Prime Minister May has so far been disinclined to pay the price of splitting her Tory party by acquiescing to Labour’s demand. As things stand, all options remain open, from a no-deal scenario to a soft version of Brexit, to a new referendum or a general election. Analysists continue to see a no-deal Brexit scenario as being no more than a low-risk possibility.
The Dollar majors have been trading in narrow ranges so far against a backdrop of moderately bullish Asian equity markets and rising sovereign bond yields. EUR-USD has been narrowly orbiting the 1.1300 level, consolidating recent gains from the six-week low at 1.1183, seen on April 2. USD-JPY has been gravitating around the 112.00 level with the pair consolidating the near 1 big figure rally that was seen on Friday, which had been the product of pronounced yen underperformance amid M&A-related flow and a strong risk-on sentiment in global markets, the latter of which was stoked by much better than expected trade data out of China and reassuring corporate earnings figures and guidance. More of this theme looks likely, with investor risk appetite looking likely to hold up amid fresh signs of progress on the U.S.-China trade front. U.S. Treasury Secretary Mnuchin said over the weekend that talks are nearing the final round and would do “way beyond” previous efforts to open China’s markets to U.S. companies. Cable, AUD-USD and USD-CAD, among other pairings have also been directionally challenged so far today.
Source: XE Market Analysis Europe: Apr 15, 2019
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