Wary Traders Push Pound Higher

Despite the news that a deal on the Brexit departure could be struck between the two major political parties, uncertainty among investors kept the Pound Sterling steady but unable to move higher. The sticking point, says analysts, is the call for a second referendum to confirm the Brexit. Labour Party members have said that they would reject any plan which failed to include another referendum while a number of Conservative Party members are abjectly opposed to it. What Sterling traders would like to see is, in fact, a second referendum which would provide support for the Pound. The date for the UK's departure from the European Union is still several months away and until an agreement is reached, FX traders are buckling down for more uncertainty.

As reported at 11:24 am (GMT) in London, the GBP/USD was trading higher at $1.3024, a gain of 0.1885% and moving off the session peak of $1.3025. The EUR/GBP was trading lower at 0.8628 Pence, down 0.1851%; the pair has ranged from a low of 0.86267 Pence to a peak of 0.86460 Pence.

UK Data in Focus

Upbeat economic news would usually help support the Pound, but FX traders are too wary of the Brexit implications to back the currency. On Friday, the Office of National Statistics had reported that the British economy grew at 0.5% (on a quarterly basis) in Q1, largely as expected, with growth on an annual basis ticking up to 1.8% in the quarter from 1.4%. The latest surveys have suggested that manufacturers had been hoarding goods in case British was forced to crash out of the EU in March. How that will impact the upcoming labor data is the question for some analysts who want to see if that stockpiling has had a negative impact on labor. Tomorrow, the ONS will be releasing employment figures for three-month period to March, with expectations of a decline across the board.

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.