Today saw the pound struggle to benefit from a sense of optimism over signs of support for Mrs May’s ‘Plan B’, following comments from Conservative hard-Brexiteer Jacob-Rees Mogg, who also voiced confidence in the deal if it could be ‘reformed’. The support, meanwhile, has undergone a ‘reality check’ in which questions about the likelihood of Mrs May putting forward these amendments seems increasingly unlikely. Pound traders, however, have remained cautious which has reined in some of the pound’s gains this morning, as threats of a Brexit no-deal still loom with Mrs May refusing to remove the option from the table – despite mounting opposition from both parties. Today saw the publication of the UK BBA mortgage approvals figures for December, which fell below expectation to 38.779K.
The US dollar, meanwhile, was strengthened against the pound by yesterday’s raft of positive US data releases, with the most notable being the better-than-expected increase in the Markit manufacturing PMI figures for January.
Yesterday also saw the publication of US initial jobless claims figures for January, which showed a positive decrease, buoying confidence in the US labour market.
The continuing partial US government shutdown is preventing some of the US dollar’s further gains today, as it now enters its sixth week.
This is following yesterday’s tensions between President Donald Trump and House Speaker, Nancy Pelosi, who thwarted Trump’s State of the Union address.
Mr Trump hit back on Twitter.
He said: “Nancy just said she ‘just doesn’t understand why?’ Very simply, without a Wall it all doesn’t work.
“Our Country has a chance to greatly reduce Crime, Human Trafficking, Gangs and Drugs. Should have been done for decades. We will not Cave!”
The pound us dollar exchange rate, however, will likely be driven by political forces into next week with any signs that Mrs May’s ‘Plan B’ failing likely to hit the pound to US dollar exchange rate.
Daily Express :: City and Business Feed