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Fri 15 Feb 2019 18:53GMT

Pound (GBP) Struggles as Worries over Theresa May’s Brexit ‘Plan B’ Increase Ahead of Vote

Published: 28 Jan at 4 PM Tags: Euro, Dollar, Pound Sterling, America, UK, Eurozone, Australian Dollar, New Zealand Dollar, Canadian Dollar, Australia, New Zealand, USA, Canada, China, Ireland,

Pound Sterling (GBP)
The Pound (GBP) struggled today due to an absence of notable UK data release and increasing concerns ahead of tomorrow’s parliamentary vote on Prime Minister Theresa May’s Brexit ‘Plan B’.

Former Foreign Secretary Boris Johnson, however, failed to restore confidence to Pound investors despite claiming that if May’s ‘Plan B’ were to include an amendment concerning the Irish backstop, then Parliament would back May’s deal with ‘full-throated’ support.

US Dollar (USD)
The US Dollar (USD) failed to make any significant gains today despite the reopening of the US government after its longest shutdown in history.

USD investors, however, are remaining cautious as the divide between President Donald Trump and the House of Representatives over funding for the Mexican border wall is likely to continue – and another shutdown is expected to follow.

Euro (EUR)
The Euro (EUR) climbed today after the publication of the Eurozone’s lending figures restored confidence in the Eurozone’s growth after last week’s disappointing ecostats.

Today also saw the President of the European Central Bank, Mario Draghi, make some dovish comments in which he referred to continuing political upheavals and corresponding uncertainty as dampening confidence in the Eurozone’s economic health.

Australian Dollar (AUD)
The Australian Dollar (AUD) remained weak today as Australia’s banks remained closed for Australia Day.

Because of this today saw no releases of any significant Australian ecostats, however news that President Trump would once again engage in US-China trade talks on 30 January has restored some faith for ‘Aussie’ investors.

New Zealand Dollar (NZD)
The New Zealand Dollar (NZD) held onto most of its gains from last week after traders fled to other currencies due to the ongoing partial US government shutdown, with the ‘Kiwi’ benefiting generously.

‘Kiwi’ traders, however, are awaiting the publication of New Zealand’s trade balance figures later on today, which are expected to show the first surplus since June last year.

NZD had some of its gains tempered today, however, after the publication of China’s industrial profits figures for December showed a disappointing fall to 10.3%; and with China being New Zealand’s biggest trading partner this has dampened ‘Kiwi’ sentiment.

Canadian Dollar (CAD)
The Canadian Dollar (CAD) weakened significantly today after US oil prices dropped over 3%, weakening the oil-reliant ‘Loonie’ as traders became increasingly skittish.

CAD has also failed to benefit from a lack of Canadian data releases today, and has failed to hold onto its gains from Friday when US President Donald Trump signed a bill which has allowed the Federal Government to once again open – although this is limited to three weeks of funding.

As of Monday, 28th January 2019, the Pound Sterling currency rates mentioned within this news item were as follows:

GBP EUR exchange rate was 1.1511, GBP USD exchange rate was 1.3157, GBP AUD exchange rate was 1.836, GBP NZD exchange rate was 1.926, GBP CAD exchange rate was 1.7445, and GBP CNY exchange rate was 8.8748.
Dominic Lee About Author: (332 Posts)With over ten years experience as an economist – including four years spent as a chief economist with a major currency broker – Dominic has acquired a wealth of knowledge which he uses to forecast market movements. Dominic now works as an independent business advisor and writes for several financial publications.

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