Pound Falls After Trump's Comments On UK-US Trade Deal
November 27 2018 - 2:25AM
RTTF2
The pound lost ground against its key counterparts in the
European session on Tuesday, after U.S. President Donald Trump
remarked that U.K. Prime Minister Theresa May's Brexit deal could
endanger the country's chances to enter into a trade deal with the
U.S.
"Right now as the deal stands she may not -- they may not -- be
able to trade with the U.S. and I don't think they want that at
all, that would be a very big negative for the deal," Trump said
Monday.
The currency was also weighed by comments from UK Brexit
Secretary Stephen Barclay, who suggested that getting the Brexit
deal approved through Parliament would be a tough task.
The deal will be put to vote in Parliament on December 11.
May faces very difficulty to get Parliamentary backing on her
plan as over 90 Tories reportedly pledged to go against the PM by
voting against her withdrawal agreement.
European shares were mixed as oil prices resumed their slide and
investors digested a fresh profit warning from Thomas Cook
Group.
Analysts remain skeptical about the prospects of a U.S-China
trade deal after U.S. President Donald Trump said he would likely
raise the punitive tariffs on $200 billion of Chinese goods.
Trump also threatened to impose tariffs on all remaining Chinese
imports, if upcoming trade talks fail to produce a deal.
The currency has been trading in a negative territory against
its major counterparts in the Asian session.
Reversing from its early highs of 0.8836 against the euro and
1.2798 against the franc, the pound slipped to 5-day lows of 0.8883
and 1.2732, respectively. If the pound slides further, it may find
support around 0.90 against the euro and 1.26 against the
franc.
The pound fell to near a 2-week low of 1.2734 against the dollar
and a 4-day low of 144.60 against the yen, from its early highs of
1.2820 and 145.54, respectively. On the downside, 1.26 and 143.00
are likely seen as the next support levels for the pound against
the dollar and the yen, respectively.
Looking ahead, U.S. consumer confidence for November, Federal
Housing finance agency's house price index and S&P Case-Shiller
home price index for September are due in the New York session.
At 2:30 pm ET, Atlanta Fed President Raphael Bostic will
participate in a panel discussion about the economy, regulation,
financial innovation, and the future of payments at The Clearing
House and Bank Policy Institute's Annual Conference in New
York.
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