The British Pound has been on the back foot since Parliament voted down a binding amendment to prevent a hard Brexit. What’s next?
Here is their view, courtesy of eFXdata:
MUFG RHere is their view, courtesy of eFXdata:research discusses GBP outlook in light of its setback on the failure of the”Yvette Cooper” amendment.
“The pound has suffered its first setback after making a strong start to 2019. Cable fell back overnight to an intra-day low of 1.3057 where it has found support from its 200day moving average. Market participants building optimism that a “No Deal” Brexit will be avoided has been challenged by parliament’s failure to pass the “Yvette Cooper” amendment which could have forced the government to extend Article 50 if an acceptable Brexit deal had not been reached by the 26th February,” MUFG notes.
“The EU has been quick to reiterate that they are not willing to reopen the withdrawal agreement, and are more willing to make changes to the outline for future relations…The government is still chasing Brexit unicorns. With time running out, we still believe that a UK request to extend Article 50 appears increasingly likely despite last night’s developments.
Until there is clearer evidence that the UK is heading towards extending Article 50, the pound may find it more of a struggle now to advance further in the coming weeks. It leaves the pound more vulnerable to a reversal of recent gains as well,” MUFG adds.
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