Pound Pressured by Ireland Worries

07 December 2017 11:38:57 AM

The Pound Sterling remained close to an 8-day low as FX traders monitor the latest Brexit related developments. Analysts say that it will be Brexit news which will drive Sterling sentiment, and despite negative headline risks, FX traders are sitting it out and remaining on the sidelines. At stake now is the next phase of the talks which focuses on trade between the UK and the EU and the 2-year transition deal which would come into effect in March 2019. What has caused the delay is the situation regarding the border between Northern Ireland and Ireland. The Northern Irish political party which typically does support Theresa May rejected a recent proposal from the UK government.

As reported at 11:00 am (GMT) in London, the GBP/USD was trading at $1.3395, a gain of 0.11%; the pair earlier hit a session trough of $1.3362 before recovering. The EUR/GBP was trading at 0.8794 Pence, down 0.42%; the pair has ranged from a session low of 0.87790 Pence to a peak of 0.88300 Pence.

Markets Look Ahead to NFP

In the US, the market talk is still of tax reform though positive momentum seems to be waning to some extent. The EUR/USD was trading at $1.178, down 0.19% and moving off the session peak of $1.18087. With some jobless claim figures coming out later today, markets will be focusing their attention on tomorrow’s release of non-farms labor data from the US government. Currently, analysts are forecasting a decline to 200K new jobs from 261K in November; ADP yesterday reported that private sector jobs hit 190K, slightly above analysts’ forecasts of 185K.

Barbara Zigah is a freelance journalist living in Ghana, who specializes in Forex-related content; her online work has appeared in the IB Times, NASDAQ, Benzinga, and Seeking Alpha.

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