- GBP/USD looks for a clear direction while keeping the recently positive tone.
- British concessions pave the way for a Brexit deal, markets await official confirmation amid mixed signals.
- Chatters that the deal may come today or tomorrow keeps Cable positive.
- US dollar weakens as President Trump crosses Congress over bipartisan covid aid package, government funding and defense policy bill.
GBP/USD wavers around 1.3500 during the early Thursday morning in Asia. The cable snapped a three-day losing streak on Wednesday amid Brexit hopes, well as broad US dollar weakness. However, a lack of official confirmation and mixed clues from media keeps the Sterling traders on their toes.
While the UK’s easing of demands over fisheries lead to notable progress in the Brexit talks, which many media sources mark while pointing to an imminent deal, a lack of official announcement requires caution over the key market issue. Late on Wednesday, UK PM Boris Johnson was heard to call a press conference but nothing could roll out from London since then.
On that, ITV’s Robert Peston said, “Grim news. When I put to a source that the trade-deal announcement and press conference would be at 1:00 am, the response was ‘that would be nice; Brexit and deadlines though…’ You have been warned (or rather I have).”
The latest over Brexit can be heard from Joe Barnes from Daily Express who tweets, “Senior European source tells me Boris Johnson is willing to accept that the EU hands back just 25 percent of the value of fish it catches in British waters, over a 5.5-year transition period. The UK was previously insisting on 35 percent, over three years.”
Over the counter, US President Donald Trump vetoes the policymakers’ efforts on the Defense Bill, coronavirus (COVID-19) aid package and government funding. While challenging the Defence Bill, the Republican leader increases the hardships of China and Russia. On the other hand, stopping the stimulus, just to add more funds in the vault, pushes the diplomats toward increasing the paycheck amount to $2,000 from the previously agreed $600.
Elsewhere, virus woes keep challenging the sentiment but fail to get noticed amid the nearness to the year-end holiday celebrations.
Against this backdrop, Wall Street indices trade mixed with minor moves while the US 10-year Treasury yields add 2.8 basis points to 0.948% by press time.
Looking forward, the Asian calendar contains fewer data/events but Brexit and US stimulus keep the driver’s seat.
Technical analysis
A one-week-old triangle formation between 1.3405 and 1.3570 restricts the GBP/USD prices with an upside bias.
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