Friday, October 30

GBP/USD remains steady above 1.2900 despite hard-Brexit speculation

  • GBP/USD trims losses and closes the week above 1.2900.
  • The pound shrugs off Boris Johnson’s call for a no-deal Brexit.

The sterling has shown resilience on Friday and managed to trim previous losses against the US dollar despite UK PM Boris Johnson’s plea to prepare for a no-deal exit from the European Union.

The pound trims losses and regains the 1.2900 level

Sterling has shrugged off negative pressure on Friday, taking advantage of a somewhat weaker US dollar, to bounce up from week lows at 1.2865 and return to 1.2920. The weekly chart, however, shows the pound on track to a 0.8% decline.

The uncertainty about the outcome of the Brexit talks with the EU has been the pound’s main driver this week. The initial optimism about the possibility of a trade deal vanished on Thursday when the disagreement on some key issues became more evident and sent the GBP lower against its main rivals.

The market, however, has reacted surprisingly cool to Johnson’s tough rhetoric. The pound has remained fairly firm across the board, even in a mildly positive tone, which suggests that the investors are still confident on a last-minute deal. This view has been reinforced by the European Commission President, Ursula van der Leyden, who affirmed that the EU will continue working to reach an agreement with the UK.

Technical levels to watch

Credit: FX Street

Leave a Reply