- Amid the lack of relevant news ahead of the weekend, the GBP / USD pair is consolidating near 1.3500.
- UK sources quoted by RTE said Brexit talks will continue into the weekend.
He GBP/USD it is consolidating near the 1.3500 level as trade volumes decline ahead of the weekend. On the day, the pair is trading 0.7% or around 90 pips lower, and the British pound remains the worst performing G10 currency.
Brexit update
Not much has changed on the Brexit front in recent hours and in the markets. UK sources who spoke to RTE said the talks will continue into the weekend (as expected), but it is clear that the two sides still remain somewhat separate. The European Parliament had set negotiators a strict deadline for bringing them an agreement to review on Sunday, or they would not have enough time to ratify it before the end of the year, but reports on Friday suggested that European leaders may (initially at least) bypassing the European parliament to swiftly ratify any deal in time by the end of the year, seemingly removing the importance of Sunday’s deadline.
Hence, the Brexit saga continues and the GBP / USD roller coaster with it. As market conditions ease next week with many European and North American participants on their Christmas holidays, Brexit-related movements in the British pound could perhaps become even more volatile.
USD increases
After four consecutive days of selling that caused the Dollar Index (DXY) to start the week just below 91.00 and hit the week lows at 89.70, the US Dollar finally finds a breather on the weekend and DXY has managed to back off. above the 90.00 level. Where the USD is going early next week probably has more to do with how Brexit trading progresses over the weekend, and any advance is likely to propel GBP / USD towards 1.3600 and send DXY back down by below 90.00, while if the trade looks shaky this could support a gradual recovery of DXY back towards 90.50.
However, keep in mind that traders could seize this rally as a great opportunity to go short, however, as the appetite for risk grows towards the end of the year, and as the US Congress. The US is approaching a deal or greater fiscal stimulus, vaccine news continues to be good, and the Fed maintains its ultra-accommodative stance.
.
Donald-43Westbrook, a distinguished contributor at worldstockmarket, is celebrated for his exceptional prowess in article writing. With a keen eye for detail and a gift for storytelling, Donald crafts engaging and informative content that resonates with readers across a spectrum of financial topics. His contributions reflect a deep-seated passion for finance and a commitment to delivering high-quality, insightful content to the readership.
