The Sterling pound today rallied against the dollar on positive investor sentiment before falling on Brexit jitters after comments from the Irish government. The GBP/USD currency pair later rallied even after the UK said that it was actively preparing for a no-deal Brexit scenario as the October 15 deadline approaches.
The GBP/USD currency pair today fell to a low of 1.2846 in the early American session before rallying close to its daily highs of 1.2929 printed earlier in the London market.
The currency pair rallied higher earlier today reversing yesterday’s massive drop before Irelandâs Foreign Minister Simon Coveney said that the EU’s top negotiator Michel Barnier would not agree to expedited talks unless the UK shifts its stance on state aid. However, the UK’s lead Brexit negotiator David Frost told reporters that the UK was willing to trade on Australia terms if a deal could not be reached. The release of the disappointing UK house price index report by the Office for National Statistics also contributed to the pair’s initial decline. Cabinet Minister Michael Gove confirmed the government’s stance saying that preparations for a no-deal Brexit were intensifying.
The cable’s rally during the American session was fueled mainly by the greenback’s weakness as tracked by the US Dollar Index, which hit a low of 93.56. The release of the FOMC minutes later in the session had a muted impact on the pound.
The currency pair’s future performance is likely to be affected by Andrew Bailey’s speech tomorrow and US dollar dynamics.
The GBP/USD currency pair was trading at 1.2915 as at 20:35 GMT having rallied from a low of 1.2846. The GBP/JPY currency pair was trading at 136.85, having risen from a low of 135.95.
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