- Pound is under pressure, cable falls below 1.1400.
- EURGBP is heading for its highest daily close since October 11.
EURGBP continued to rise during the American session and reinforced the recovery after breaking above 0.8800. The cross reached a high of 0.8820, reaching the highest level since October 11.
The pound is one of the worst performing currencies in the G10 on Wednesday. The currency remains vulnerable after two months of political and economic tensions in the UK. The cautious tone in the financial markets does not help the pound. The Dow Jones falls 0.87% and the Nasdaq 1.25%.
GBPUSD’s drop below 1.1400 adds to the general decline in the pound. At the time of writing, cable is trading at 1.1370, the lowest level in two days, down more than 150 points.
“Over the coming weeks, we expect sterling investors to focus on the impact of the 17th November autumn statement, Prime Minister Sunak’s ability to hold the Conservative party together, the growth/recession outlook for the UK and Bank of England interest rates.We expect that protocol related issues (for Northern Ireland) will only have a clear impact on sterling as the corresponding deadlines approach.We are not convinced yet modify our bearish view on the pound and maintain a 3-month forecast of 0.89 EUR/GBP,” Rabobank analysts said.
Technical levels
Source: Fx Street
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