"Positive and Promising" Brexit Talks See the British Pound Rally Overnight

Xe Corporate APAC

October 10, 2019 2 min read

The AUDUSD opens at 0.6765 and the NZDUSD opens at 0.6321 this morning.

The big mover overnight has been the British Pound, which is up circa 1.5% across the board. There was a meeting between Boris Johnson and the Irish PM, which was “positive and promising”. The market has really latched on to it and rallied. However as part of the statement, “Consent and customs are issues, issues that still need to be resolved.” To us, this does not really fundamentally change anything, as these issue have been the main thing stopping the UK from stumbling out of the EU Trading Bloc.

In breaking news, Britain is also proposing a pared down free trade agreement, in a hope to end the Brexit stalemate. This presumably would be more straightforward to get sign off on, and a wider deal could then be built around it. For those on the quiz choosing between a) Deal, b) No Deal, c) Extension and d) Snap Election, the correct answer is obviously e) Who cares, we have a trade agreement. In all seriousness though, it really highlights that a “No deal” if and when it eventuates is not going to be marketed as such, and will be sold as a win, which should pare some decline.

Against the rest of their peers, the Aussie and Kiwi Dollars are basically treading water, still yet to break out of their recent ranges.

Global equity markets were higher on the day - Dow +0.42%, S&P 500 +0.48%, FTSE +0.28%, DAX +0.58%, CAC +1.27%, Nikkei +0.45%, Shanghai +0.78%.

Gold prices dropped -0.4% to USD$1,501 an ounce. WTI Crude Oil prices are up 1.9% to US$53.55 per barrel.

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