Pound Falls to New 2020 Lows as the Dollar Hits Multi-Month Highs

The Sterling pound today edged lower against the US dollar for the second consecutive session as investors remained worried about a hard Brexit. The GBP/USD currency pair fell amid a lack of significant releases from the UK docket and was fueled by the much stronger greenback.
The GBP/USD currency pair today fell from a high of 1.2998 in the early London session to a low of 1.2949 in the American session and was near these lows at the time of writing.
The currency pair traded sideways with a slight bearish bias during the Asian session before heading much lower in the London session. The pound’s woes were driven by the risk-off sentiment dominating markets as investors grapple with multiple threats. The fact that the UK and EU have taken uncompromising stances on the Brexit talks has investors worried that the UK could crash out of the European Union without a deal on 31st December. The rally by the greenback witnessed in the American session, even as the US Dollar Index rallied to a 3-month high of 98.57, also drove the pound lower.
The dollar’s growing strength meant that the cable had little chance of a recovery after the American session got underway. The release of upbeat US initial jobless claims data by the Department of Labor also contributed to the cable’s fall.
The currency pair’s future performance is likely to be affected by investor sentiment and tomorrow’s US ADP jobs report.
The GBP/USD currency pair was trading at 1.2934 as at 16:48 GMT, having dropped from a high 1.2998. The GBP/JPY currency pair was trading at 142.18, having fallen from a high of 142.81.

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