Forex

Sterling remains steady as Brexit negotiations proceeds

Pound Sterling

Monday, pound sterling remained steady ahead of the start of the Brexit conferences. Pound sterling was little changed at $1.2777 GBP=D3, which shows that the currency barely even moved despite on the news that reported a van ploughed into worshippers leaving a London mosque on Monday, killing at least one person and injuring several people.

Pound Sterling has been through a stormy month, sinking to a near two-month low of $1.2636 on June 9 on the British election shock. However, rallying last week as the Bank of England came close to hiking rates after a split vote in its monetary policy committee. In addition, it is expected to remain vulnerable to attacks of instability in coming months as negotiations proceed on Britain’s exit from the European Union.

After Prime Minister’s Conservative party’s setback in this month’s election deepened uncertainty for over both the Prime Minister Theresa May’s Brexit plans and her political future, investors are now focusing on the United Kingdom’s government’s stance in the Brexit talks. In relevance to this, Tareck Horchani, head sales of trading Asia-Pacific, for Saxo Bank Group in Singapore said that the UK government may be open to making some concessions and aim for a soft Brexit.

On the other hand, investors are also awaiting comments from top Federal Reserve official to see whether the United States dollar’s recent rise can be sustained. The dollar index .DXY, which measures the dollar against its six major rivals, held steady at 97.172. The index also climbed to a two-week high of 97.560 late the previous week after the Federal Reserve raised interest rates and kept the door open for another hike in 2017.   

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