Archives of “Brexit” tag

rss

EU said to see Brexit deal as impossible unless the UK moves

  
  Analysis
#  #  #  #  #  #  #

The pound sinks further on the headlines

  • Technical Brexit negotiations said to have reached an impassse
  • Brexit negotiations may collapse amid DUP resistance towards a deal
  • Fate of Brexit negotiations said to hinge on a move from London now
This is coming via Bloomberg and reaffirms the earlier sentiment that we’re reaching a bit of a sticking point as the DUP is failing to get on board with the proposed Brexit deal.
The pound has fallen further on waning optimism with cable dropping to a low of 1.2658 from 1.2730 before recovering to near 1.2700 currently.

Pres. Trump sounds off….

  
  Analysis
#  #  #  #  #  #

…Stocks are not liking the optics of it all

Pres. Trump is sounding off as he defends himself in the way he knows how. Below are a sampling of the recent tweets:
...Stocks are not liking the optics of it all
He is also on the wires saying:
  • He thinks the whistleblower should be protected if he is a legitimate whistleblower
But adds:
  • Person who provided whistleblower information is a spy
What does it have to do with the market?
Stocks continue to suffer, as things are seemingly more and more in disarray.
The S&P is currently down 56 points or -1.9% at 2884.30. The NASDAQ is down 142 points or -1.8% at 7766.  Both are near lows for the day.

S&P index

Gold prices remain elevated at plus $21.50 or 1.45% at $1500.50.
The USD is mixed
  • The USDJPY is seeing the safe haven flows and trades near lows for the day
  • The USDCHF, which was up near 90 pips earlier after weaker CPI inflation, has moved back to mid range.
  • The EURUSD moved to new highs on some dollar selling
  • The GBPUSD has also recovered (dollar selling) after being lower on Brexit concerns earlier.

A couple of Brexit scenarios to ponder (and what they mean for EUR/GBP)

  
Analysis, Forex
#  #  #  #  #  #  #  #  #

An overnight bank note (Rabo) on Brexit and euro / sterling

(in brief, and note this prior to Wednesday’s UK voting)
If legislation to rule out a no deal Brexit is rushed through parliament, the pound can be expected to rise. If it were decided that the Brexit deadline were to be extended but that the legal default position of the UK remains that a no deal Brexit could still take place at a future date, GBP may also rise, but by a lesser amount – since kicking the can down the road is not a solution.
  • In this scenario we would expect EUR/GBP to be trading in the 0.90 area on a 1 to 3 month horizon.
If a no deal Brexit is ruled out will would expect EUR/GBP to clamber back towards the 0.86 area in 3 months. 
If fresh legislation is not passed and the UK remains on course for a no deal Brexit in October we would expect EUR/GBP to rise firstly back towards the recent high in the 0.9325 area. 
How high EUR/GBP can go may then depend on whether the EU summit in mid-October brings any compromises.” “On a no deal Brexit on October 31, we expect EUR/GBP to rise towards parity.
Go to top