After a pretty arduous session for the Pound (GBP) last week the UK currency finally managed to find some respite on Friday following an EU summit to discuss the current state of Brexit negotiations.
While EU leaders stated that progress was still currently insufficient for the second stage of talks to begin, they suggested that the recent reports of a ‘deadlock’ may have been exaggerated and that trade talks could start in December if progress continues.
Meanwhile, Sterling may extend its gains later this morning following the release of the CBI’s latest industrial trends figures, with the orders index expected to have risen from 7 to 9 in October.
The Pound Euro (GBP EUR) exchange rate rallied by around a cent at the end of last week’s session following suggestions that Brexit trade talks would get underway by the end of the year.
The trend has continued at the start of this week’s session as the political situation in Spain makes investors increasingly wary as Madrid moves to impose direct rule on Catalonia.
However, the single currency may recoup some of its losses this afternoon as the Eurozone’s latest Consumer Confidence data is expected to show a slight uptick in household sentiment this month.
Sterling ticked higher against the US Dollar (USD) on Friday, ending a string of losses between the pairing last week on optimism over the progress of Brexit negotiations.
However, the Pound is a little more muted against the ‘Greenback’ this morning as the US currency has found modest gains in the wake of Shinzo Abe’s victory in Japanese elections over the weekend and a subsequent dip in the Japanese Yen (JPY).
Meanwhile the US Dollar may continue to strengthen over the coming days on hopes that the recent passing of Trump’s budget for the next fiscal year will lead to his administration finally making progress on his long awaited tax reforms.
The Pound Canadian Dollar (GBP CAD) exchange rate surged by around five cents at the end of last week as following a sharp and unexpected decline in Canadian retail sales as they slumped from 0.4% to -0.3% in August, souring chances that the Bank of Canada (BoC) may implement another rate hike this year.
After rallying against the Australian Dollar (AUD) on Friday following the upbeat reaction to comments from the EU summit, Sterling has largely been muted against the ‘Aussie’ this morning as the Australian currency is bolstered by a sudden uptick in iron ore prices.
New Zealand Dollar
The Pound New Zealand Dollar (GBP NZD) exchange rate is trading close to a five-month high this morning as the pairing holds on to much of the gains made in the latter half of last week as investors reacted warily to the formation of a new coalition government in New Zealand.
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