GBP/USD refreshes seven-week low under 1.2100 on Brexit, BOE headlines
|- GBP/USD registers six-day losing streak after the biggest weekly loss in eight.
- UK diplomats restart preparing for no-deal Brexit, EU’s Barnier said not to bargain values for the benefit of the British economy.
- BOE’s Haldane reports the central is examining unconventional monetary policy measures more urgently.
- Comments from the Fed’s Powell, Brexit/virus headlines remain in the spotlight.
Having flashed the biggest weekly loss in two-month, GBP/USD kick-starts the new week on the back foot while declining to 1.2077 amid the early Monday morning in Asia. In addition to the coronavirus (COVID-19) challenges, weekend headlines concerning the Brexit and the BOE’s next move seemed to weigh on the Cable off-late.
Read: What you need to know before markets open: Risk-off, GBP heavy funda, cold wars, Powell on TV
The third EU-UK negotiating round was disappointing...
This comes from the European Union (EU) chief Brexit negotiator Michel Barnier. The bloc’s representative added, during his press conference on Friday, that they haven't made any progress on governance either.
On the other hand, the Sunday Times came out with the news that the senior government figures said the UK was preparing to “walk away” from trade talks with Brussels in the next month unless the EU gives ground.
More recently, UK Telegraph quoted the British negotiator for Brexit talks David Frost saying that the UK-EU relations have "plummeted to a new low after the last round of trade negotiations closed in mutual recrimination."
BOE is reviewing several policies…
BOE’s Chief Economist Andrew Haldane crossed wires during the weekend while suggesting that the British central bank is examining unconventional monetary policy measures more urgently amid the economic slump caused by the coronavirus pandemic, per the Bloomberg. It’s worth mentioning that the BOE Governor Andrew Bailey emphasized the use of expanding monetary stimulus in his latest comments.
Elsewhere, the UK PM Boris Johnson-led Tory government’s handling of the virus outbreak has been criticized despite huge stimulus being announced by Chancellor Rishi Sunak. The Sky News came out with the updates suggesting that the University of Oxford to find an effective drug is "progressing well" but there are no guarantees, warns a UK minister.
While the EU-UK ministers have called off the Brexit talks and the economic calendar is also a lighter one, virus updates, as well as the Fed Chair Powell’s speech, up for publishing on Sunday 23:00 GMT, will be the key to follow.
Technical analysis
While 1.2000 psychological magnet is appearing on the bear’s radar as the immediate support, late-March tops near 1.1970 and 1.1935 can check the sellers afterward. On the contrary, the monthly falling trend line resistance, at 1.2261 now, keeps the buyers away.
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