Pound Declines Amid Brexit Uncertainty and Tory Party Defections

The Sterling pound today was on a downtrend against the US dollar as investors reacted to the Brexit stalemate among UK leaders, which has led to party defections. The GBP/USD currency pair declined for most of the Asian session before consolidating in the European session, but was rallying higher at the time of writing.
The GBP/USD currency pair today dropped from an Asian session high of 1.3077 to a low of 1.3012 before retracing most of its losses and rallying higher.
The currency pair’s decline during the Asian session was largely seen as a pullback following yesterday’s impressive rally. The pullback lasted into the European session as investors remained cautious waiting for the meeting between Theresa May and European Commission President Jean-Claude Juncker. The lack of any major releases from the US and UK dockets also contributed to the consolidation. The release of the positive UK CBI total trends orders in the mid-European session had a muted impact on the currency pair.
The pair later rallied higher amid three Tory resignations in a move that could be interpreted as a vote of confidence in the new political movement. The three Conservative Party MPs joined eight Labour Party MPs who also resigned from their party to form a new pro-remain group labelled the Independent Group.
The cable’s short-term performance is likely to be affected by the release of the US FOMC minutes at 19:00 GMT and Brexit headlines.
The GBP/USD currency pair was trading at 1.3081 as at 16:16 GMT having rallied from a low of 1.3012. The GBP/JPY currency pair was trading at 144.87 having risen from a low of 144.11.

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