Pound Higher Despite Wary Trade
The Pound Sterling got a boost against the US Dollar on news that the Chancellor of the Exchequer reported that the EU was ready to ensure a Brexit deal would be forthcoming. However, FX traders are wary of the outcome of the Conservative Party conference and, as a result, are keeping gains limited in fear of a swift reversal. The conference is due to begin this week and the Prime Minister will have the opportunity to argue her rationale for leaving the European Union. What is a concern is that her critics, especially Boris Johnson, the ex-foreign secretary, will publicly take a stand against her plans.
As reported at 11:19 am (BST) in London, the GBP/USD was trading higher at $1.3042, a gain of 0.12%; the pair has ranged from a session peak of $1.306 while the low was recorded at $1.3023. The EUR/GBP is trading at 0.8903 Pence, down 0.08% and off the session low of 0.88796 Pence while the peak is at 0.89160 Pence.
Conservative Party Meeting in Focus
Analysts say that though the Prime Minister is optimistic, the reality suggests that Conservative party divisions could result in an unwanted outcome which would be negative for the Pound. On the positive side, analysts also believe that a dip in the Pound's price this week could be a buy opportunity, given that an Irish border deal is likely to result in a “sharp repricing” of the GBP/USD pair.