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GBP Rallies as MPs Look to Stop a No-deal Brexit, BoC Decides on Rates

JFD

After touching its lowest since October 2016 against the US dollar, the British pound rallied yesterday on news that UK lawmakers will take control of the parliamentary agenda today in an attempt to block a no-deal Brexit on October 31st. Today, they are expected to vote on whether they should force the government to seek another delay, while PM Johnson is likely to call for a vote over new elections. Elsewhere, the BoC decides on interest rates, with investors probably eager to find out whether policymakers will turn more dovish, or not.

Pound Rallies as UK Lawmakers Seek Another Brexit Delay

Once again, it was mostly about the pound. The currency started Tuesday off by extending its prevailing declines, but that didn’t last for long. During the European trading, after hitting its lowest since October 2016 against the US dollar, the currency rebounded and continued sailing north throughout the rest of the day. This morning, it is found higher versus USD, CAD, JPY, EUR, NOK and SEK, while it is virtually unchanged against CHF. The currencies that managed to eke out gains against their British counterpart are AUD and NZD, which strangely gained after Australia’s GDP matched expectations of +1.4% yoy, a rate below the RBA’s latest projection for the quarter and the worst in a decade.

Needless to say, the driver behind the pound’s volatile session was once again developments surrounding the UK political scene and the Brexit sequel. The alarm to...

Read the full financial markets daily report on JFD Research.

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Source: https://www.jfdbank.com/en/research/gbp-rallies-as-mps-look-to-stop-a-no-deal-brexit-boc-decides-on-rates-20190904
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