Search ForexCrunch
  • EUR/GBP remained under some selling pressure for the second consecutive session on Thursday.
  • Hopes for an imminent Brexit deal underpinned the sterling and was seen exerting some pressure.
  • Investors now look forward to an official confirmation that an agreement has finally been reached.

The buying interest around the sterling picked up pace during the early European session and dragged the EUR/GBP cross below the key 0.9000 psychological mark, or one-week lows.

The cross extended this week’s sharp retracement slide from the 0.9215 region and witnessed some follow-through selling for the second consecutive session on Thursday. The British pound’s relative outperformance against its European counterpart could be attributed to growing market expectations for an imminent Brexit deal.

Despite contradictory headlines, investors remain convinced about the prospects for a deal and now wait for an official confirmation. It is worth recalling that a source at the EU’s executive Commission said on Wednesday that talks were still underway, while the British government source was also quoted saying that negotiations were ongoing.

Hence, the key focus will be on a joint conference at 08:00 GMT. The announcement could encounter a delay as the EU’s chief Brexit negotiator Michel Barnier and his UK counterpart were reportedly still speaking on fisheries. Moreover, there is a final expected call between Britain Prime Minister Boris Johnson and EU Chief Ursula von der Leyen.

Meanwhile, a modest uptick in the shared currency – amid the prevalent USD selling bias – did little to influence. This, in turn, leaves the EUR/GBP cross as the mercy of developments surrounding the Brexit saga, which might continue to infuse some volatility and assist investors to grab some short-term trading opportunities.

Technical levels to watch