Sterling Pound Tumbles to 11-Month Lows on Negative Sentiment

The Sterling pound today dropped to new 11-month lows following the resurgence of the US dollar amid negative investor sentiment towards the pound. The GBP/USD currency pair was weighed down by the looming fears of a no-deal Brexit as well as the ongoing trade standoff between the US and China.
The GBP/USD currency pair today declined from a high of 1.2960 hit in the Asian session to a low of 1.2897 in the mid-European session.
The currency pair’s decline was largely due a rebound in the US dollar as tracked by the US Dollar Index following comments from China’s Foreign Affairs Ministry regarding US sanctions on Iran. The Chinese stated that they will not accept unilateral US sanctions on Iran and will continue trading with Iran, which boosted the US dollar, as it is a safe haven currency. The increasing likelihood of a no-deal Brexit also dragged the pair lower as investors held off from buying the pound and adopted a wait-and-see attitude based on the Brexit developments.
The pound decline was slightly negated by comments from the Bank of England‘s Ian McCafferty who stated that investor expectations for several rate hikes in the next few years were acceptable. The pair’s latest decline could also be attributed to some technical selling at the previous year-to-date lows around 1.2925.
The currency pair’s performance today is likely to be affected by investor sentiment and geopolitical events given the empty US and UK dockets.
The GBP/USD currency pair was trading at 1.2902 as at 10:23 GMT having dropped from a high of 1.1960. The GBP/JPY currency pair was trading at 143.03 having declined from a high of 144.27.

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