Pound Slides on Profit Taking
Profit taking by FX traders who remain wary that Britain will be able to secure an agreement before the October Brexit deadline has pushed the Pound lower during London trade. Last week, the British Parliament had voted to compel the Prime Minister to request a postponement of the deadline but the weekend's rhetoric suggests both sides continue to have little willingness to compromise. Boris Johnson will be meeting with the EU Council today to discuss options but analysts hold out little hope for any positive outcome.
The GBP/USD pair, as a result, was trading lower at $1.2456, a loss of 0.4078% at 11:24 am in London. The EUR/GBP was trading at 0.8871 Pence, a gain of 0.1909%; the pair has ranged from a low of 0.88451 Pence to a peak of 0.89034 Pence.
UK CPI expected to Fall
On the economic data front, though there is a quiet day ahead and Brexit noise will certaintly impact sentiment, FX traders will watch for Wednesday's release of inflation data out of the UK. The latest poll of economists and analysts suggests that the August CPI figure (year-over-year) will have fallen to 1.9%, down from 2,1%. If that does, indeed, occur, the Bank of England Governor will be required to officially address the inability to meet the Bank of England's 2% inflation target with a formal letter to the Chancellor of the Exchequer. In that letter, he will outline ways that the central bank will ensure the target is soon met.