British Pound Rallies to 3-Week Highs on New Year’s Eve

The British pound today rallied higher against the US dollar largely due to high selling pressure on the greenback during the European session. The thin trading activity witnessed in the markets on the last trading day of 2018 and Brexit developments might have also contributed to the spike higher.
The GBP/USD currency pair today rallied from a low of 1.2678 to a high of 1.2780 in the mid-European session driven by investor sentiment.
The currency pair’s rally was largely caused by negative investor sentiment towards the US dollar. The Sterling pound could also have gotten a respite due to a news report by the UK Telegraph stating that British MPs are working on a plan to delay Brexit by up to a few months. This plan is to counter a move by the British Prime Minister Theresa May to wear down her opponents by delaying the vote on her Brexit deal to the last minute. Given that MPs from both the Labour Party and the Conservative Party are working together on this plan, there is a good chance it will succeed.
The US dollar opened today’s session in a much stronger position following yesterday’s tweet by President Donald Trump regarding the progress made in the US-China trade talks. This kept the cable in a consolidative phase during the Asian session.
The cable’s short-term performance will likely be influenced by geopolitical events up to tomorrow’s New Year’s holiday.
The GBP/USD currency pair was trading at 1.2778 as at 12:23 GMT having rallied from a low of 1.2678. The GBP/JPY currency pair was trading at 140.46 having risen from a low of 139.96.

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