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The British pound took the top spot this week against the major currencies, supported by Boris Johnson’s losing battle to force a Brexit, positive global risk sentiment, and late week news of potential compromises on Brexit terms between the U.K.’s political parties.
United Kingdom Headlines and Economic data
Monday:
- Recession fears ease as UK economy grows faster than expected
- Boris Johnson ‘sabotage’ letter to EU ‘would break law’
- TWO top EU chiefs have told Remainers they will BLOCK any further Brexit delays
- U.K. manufacturing production output fell by 0.5% for the three months to July 2019
- Bank of England’s Vlieghe warns of risks from new stimulus ideas
- The total UK trade deficit narrowed £14.9B to £2.9B in the three months to July 2019
- UK economy on course to grow 0.3% in third quarter, NIESR says
Tuesday:
- Liberal Democrats poised to back revoking article 50
- Britain is not seeking Northern Ireland-only backstop: PM Johnson’s spokesman
- Carney says Brexit-hit pound looks like emerging market currency
- Cross-party MPs plot to secure Brexit deal by Halloween deadline
- Recession fears fade as UK unemployment falls to lowest rate since 1970s
- Boris Johnson Vows Oct. 31 Brexit as Law Rules Out No Deal, Election Bid Fails
- Global risk sentiment began to shift towards positive for the week, starting with talk that China ready to sweeten deal by buying American goods, pushing traders away from “safe haven” assets and likely helped drawn in some support for Cable
Wednesday:
Thursday:
- The Aug. 2019 RICS Residential Market Survey results point to a renewed deterioration in U.K. sales expectations
- Court bid to force Boris Johnson to ask for extension
- Global risk sentiment continued to move towards positive on both the improving U.S.-China trade situation (China exempts U.S. agricultural products from tariffs after reports of potential interim trade deal) and the ECB’s stimulus package, another supporting argument for Sterling and its relative performance this week.
Friday:
- Brexit: DUP denies report it would accept Irish Sea checks
- Boris Johnson is edging closer towards agreeing a new Brexit deal – talk of willingness to compromise by the DUP and Northern Irish party quickly shifted sentiment on Brexit to positive, greatly reducing the probability of a no-deal Brexit for the moment. It still remains to be seen if they would be agreed to by Ireland and the rest of the EU. Sterling rallies on this development starting in the Asia session and all the way to the end of the week with the help of positive U.S.-China trade developments supporting positive global risk sentiment.