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Pound Crashes Against Dollar on Brexit Talks Failure and Mixed UK Data

December 10, 2020 at 14:33 by Simon Mugo

Close-up of the UK pound note

The Sterling pound today fell against the dollar fueled by news that there was no breakthrough in yesterday’s Brexit talks between the EU and UK leaders. The GBP/USD currency pair’s decline was also fueled by the mixed UK data released earlier today and the predominantly negative investor sentiment.

The GBP/USD currency pair today fell from a high of 1.3389 in the Australian market to a low of 1.3332 in the early London session and was headed lower at the time of writing.

The currency pair’s fall today was fueled by news that British Prime Minister Boris Johnson was unable to reach a deal with his European Union counterpart Ursula von der Lyen at yesterday’s dinner. PM Johnson flew to Brussels in an attempt to break the deadlock hit by negotiators from both sides but was unable to reach a deal. The release of the upbeat UK industrial and manufacturing production indices by the Office for National Statistics had a muted impact on the pair. The downbeat UK goods trade balance data contributed to the pair’s decline. The in-line UK monthly GDP report for October could not stop the pound’s losses.

The cable was at the mercy of the Brexit headlines and news that the European Commission was preparing contingency measures for a no-deal Brexit did not help the pair. The mixed US macro releases during the early American session did not help the pair. 

The currency pair’s future performance is likely to be affected by Brexit headlines and US dollar dynamics.

The GBP/USD currency pair was trading at 1.3289 as at 14:32 GMT having fallen from a high of 1.3389. The GBP/JPY currency pair was trading at 138.72 having dropped from a high of 139.66.

If you have any questions, comments, or opinions regarding the Great Britain Pound, feel free to post them using the commentary form below.

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