Five-month low for Sterling after the top contender to replace Prime Minister Theresa May reaffirmed his desire to take Britain out of the EU; with or without any agreement.
Boris Johnson, the leader in a contest to replace Prime Minister Theresa May, reiterated his commitment to leave the European Union with or without an agreement by Oct. 31. Boris Johnson told the BBC he was “serious” about leading Britain out of the EU without a deal if EU refused to negotiate a new exit agreement. The next Conservative party leader will be elected by the end of July, leaving only a few months to try to renegotiate a Brexit withdrawal agreement.
Against the dollar, the pound slipped 0.2% lower at $1.2664, after reaching a five-month low of $1.2507 last week. Versus the euro, the pound weakened to 89.69 pence.
Further, the US dollar rose on Wednesday as expectations dwindled for aggressive cuts in U.S. interest rates after comments by Federal Reserve officials.
Investors are waiting to see whether U.S. President Donald Trump and Chinese President Xi Jinping will at least call a truce in their trade war. Attention is focused on a meeting between the leaders of the United States and China, embroiled in a lengthy trade war. Concerns over trade, conflict and oil will dominate the G20 summit.
START TRADINGForex – Five-month low for pound on no-deal Brexit fears
Investors are waiting anxiously to see if anything comes of Sino-U.S. trade talks later this week. Sentiment was not helped by reports U.S. President Donald Trump would be content with “any outcome”.
The dollar gained, standing up from three-month lows against a basket of other currencies in the previous session at 95.843. It was up 0.1% at 96.273.
Against the Japanese yen, for example, traders have built up large option bets between 107.50 to 107 yen. In the cash market, the yen was trading at 107.45 yen.
The New Zealand dollar was the big gainer early in London against the U.S. dollar. The kiwi gained 0.4% to $0.6661 from $0.6536. The Reserve Bank of New Zealand left rates unchanged at 1.5% at its policy meeting, though it signalled another cut was likely.
Oil prices rose on Wednesday, buoyed by an outage at a major refinery on the U.S. East Coast. Industry data that showed U.S. crude stockpiles fell more than expected also weighed. Brent crude futures, the international benchmark, were up $1.24 at $66.29 per barrel by 1345 GMT. WTI crude futures were at $59.44 per barrel, up $1.61 from their last settlement.
Gold falls over 1% as Fed tempers expectations of big rate cut. Gold prices fell more than 1% on Wednesday, retreating from a six-year peak scaled in the previous session. Silver fell 0.2% to $15.34 per ounce
PLEASE NOTE The information above is not investment advice.
Sources: Reuters, Investing, CNN money