Sterling Down Despite Upbeat Data
The new year hasn't provided any relief from worry for Sterling traders who sent the Pound lower, easily reversing some of the recent gains. As has been the case for the past several months, the concerns are for the upcoming Brexit, and even an unexpectedly upbeat report on factory output did not to dispel worries. Analysts say that is because traders are able to read between the lines on that one, acknowledging that factory orders improved in December because management and ownership are worried that the March Brexit could result in massive delays in the supply chain if an agreement is not reached to soften the blow.
As reported at 11:22 am (GMT) in London, the GBP/USD was trading at $1.2672, down 0.52%; the pair earlier hit a session trough of $1.2660 while the peak is a distant $1.2773. The EUR/GBP was trading at 0.9023 Pence, up 0.30%; the pair has ranged from 0.89817 Pence to 0.90279 Pence in this trading session.
The Prime Minister has her work cut out for her, says currency strategists; Ms. May had to withdraw the planned Parliamentary vote last month because she knew that she did not have enough support to pass it. More talks will begin soon, with another vote sometime mid-month. The March 28, 2019 deadline is looming, however, and the concern is that the Prime Minister will not be able to successfully negotiate a transition period buffer, largely because her own party is blocking her efforts.