Concerns over whether or not the UK leadership can get a deal inked with their EU counterparts has pushed the pound lower versus both the greenback and the euro during London trade. Forex traders appear to be a bit more cautious that a deal won't be signed before the end of the year deadline. The latest news from the British prime minister and the president of the EU showed that both parties remained far apart regarding three critical issues; analysts say that at this point, market hopes of a last-minute deal are waning. Most political watchers do believe a deal will eventually come out of it; whether or not it will be favorable to sterling, however, remains to be seen.
As of 11:00 am in London, the GBP/USD pair was trading at $1.3304, a loss of 0.4147% and off the session trough of $1.32909. The GBP/JPY was also lower at 138.996 yen, down 0.2412%; the pair has ranged from a peak of 139.902 yen to a low of 138.799 yen. The EUR/GBP was higher at 0.9092 pence, a gain of 0.5686%, off the session peak of 0.91049 pence.
UK Data Weighs on GBP
In the UK, data released earlier today also tended to weigh on the currency, despite the fact that most of the data was actually better than expected. October's GDP rose 0.4% on a month-on-month basis, in line with predictions but far worse than the 1.1% growth in the previous month. Manufacturing production (annualized) for the month of October was at -7.1%, improved from the previous -7.9% and off the analysts' forecasts of a rise to -8.4%. On a month-on-month basis, manufacturing production was improved at 1.7% against a forecast of 0.3%, while industrial production was at 1.3%, better than the 0.3% that was predicted.