The British pound today fell to new weekly lows on rumours that the British government had initiated plans to prorogue the UK Parliament in order to facilitate a hard Brexit. The GBP/USD currency pair recouped some of its losses later in the session despite the Queen’s decision to suspend the British Parliament.
The GBP/USD currency pair today fell from an opening high of 1.2288 to a low of 1.2155 on the rumours before recouping some of its losses to trade slightly higher at the time of writing.
The currency pair traded in a sideways range during the Asian session as the bulls and bears fought for control throughout the entire session. However, the pair crashed to its daily lows in the early London session on rumours that Boris Johnson was had asked the Queen to suspend the UK Parliament in order to guarantee a hard Brexit; the pair sold off heavily for about 2 hours. However, the pair soon recovered and held on to its gains even after Queen Elizabeth II accepted Johnson’s request and adjourned the UK Parliament for 5 weeks starting on September 9.
The cable recovered as the opposition Labour Party vowed to oppose the suspension with Jeremy Corbyn saying that they will enact legislation to prevent a no-deal Brexit before the adjournment. A slight drop by the greenback as tracked by the US Dollar Index also contributed to the cable’s recovery.
The pair’s future performance is likely to be affected by Brexit headlines and tomorrow’s American releases.
The GBP/USD currency pair was trading at 1.2234 as at 16:59 GMT having recovered from a low of 1.2155. The GBP/JPY currency pair was trading at 129.66 having rallied from a low of 128.43.
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