“¢ The US bond yields tumble amid the global flight to safety and weigh on the USD.
“¢ The GBP remained on the defensive amid persistent Brexit-related uncertainties.
The GBP/USD pair now seems to have entered a bearish consolidation phase and was seen oscillating in a narrow trading band just above the 1.2600 round figure mark.
The British Pound held on the defensive amid persistent UK political uncertainty and growing fears over a no-deal Brexit, though the lack of fresh negative headlines held investors from placing any fresh bearish bets.
This coupled with a modest US Dollar pullback, led by a slump in the US Treasury bond yields amid the global flight to safety, further collaborated towards limiting any meaningful downside, at least for the time being.
The global risk sentiment took a sharp knock on Friday in reaction to the US President Donald Trump’s latest move to slap tariffs on Mexico and reports that China may limit the rare earth exports to the US.
It would now be interesting to see if the pair continues to show some resilience below the 1.2600 handle or a fresh wave of selling sets the stage for an extension of the well-established bearish trend in the near-term.
In absence of any major market moving economic releases from the UK, the incoming UK political/Brexit-related headlines might play an important role in influencing the already weaker sentiment surrounding the Sterling.
Later during the early North-American session, the US economic docket – highlighting the release of the core PCE price index, will further collaborate towards producing some meaningful trading opportunities on the last day of the week.
Technical levels to watch
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