The Sterling pound today crashed against the US dollar following media reports that the crucial Brexit vote scheduled for tomorrow had been postponed by the Prime Minister. The pound had reacted in a stable fashion earlier in the day following the release of the latest monthly UK GDP estimate, which was in line with expectations.
The GBP/USD currency pair today dropped from an intraday high of 1.2760 to hit a low of 1.2606 in the early American session.
The cable opened this week’s session with a gap down before rallying higher in the early Asian session. The currency pair later headed lower in the early European session as markets awaited the release of the latest UK GDP data. According to the Office for National Statistics, The UK GDP grew by 0.1% in October, which translated into a quarterly 0.4%; both prints met expectations. The pair still headed lower as the trade balance data for October missed expectations by a large margin due to the widening trade deficit. The Brexit new headlines applied further selling pressure on the pair driving it lower.
A Bloomberg report stating that British PM Theresa May would postpone tomorrow’s vote increased the selling pressure on the pair causing it to crash. Comments from the European Commission stating that the current Brexit deal was the final deal also drove the pair lower.
The Brexit headlines and tomorrow’s UK jobs data will affect the pair’s performance over the short-term.
The GBP/USD currency pair was trading at 1.2627 as at 15:38 GMT having crashed from a high of 1.2760. The GBP/JPY currency pair was trading at 142.60 having dropped from a high of 143.71.
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