The Pound Sterling came under pressure against the US Dollar as cautious traders exert their influence ahead of the Brexit negotiations. Only last week, the GBP/USD hit a 10-month peak after a dollar sell-off, with the Pound jumping nearly 2 cents last Friday, in the wake of disappointing data from the US. Softer than expected figures in retail sales and US personal inflation raised doubts in investors’ minds of the possibility that the Federal Reserve could push through one more rate increase later in the year.
As reported at 10:57 am (BST) in London, the GBP/USD was trading at $1.31, down 0.14%; the pair had earlier hit a session trough of $1.30675, while the high was set at $1.31140. The EUR/GBP was higher at 0.8764 Pence, a gain of 0.09%, off the session peak of 0.87662 Pence.
Outlook for Brexit Talks
Brexit talks are taking place in Brussels, Belgium between David Davis, the Brexit Secretary, and Michel Barnier, the EU chief negotiator. Barnier said that the pair had made some headway at their last meeting and will be getting into substantive issues at this one. The Brexit deal must be completed by March 30, 2019, but the terms of the deal need to be done in a way that will minimize any potential economic disruption for Britain as well as for Europe. The greatest concern is that Britain could lose access to the EU’s single market which is likely to pressure the Pound.