Brexit extension anticipation back on the cards

Ross J Burland FXStreet

Scottish First Minister Nicola Sturgeon has asked the UK's PM Boris Johnson to go against his Tory party's wishes and seek a Brexit transition period extension.

It’s now imperative that PM seeks an agreement to extend the Brexit transition period. The new Covid strain - & the various implications of it - means we face a profoundly serious situation, & it demands our 100% attention. It would be unconscionable to compound it with Brexit.
— Nicola Sturgeon (@NicolaSturgeon) December 20, 2020

The request comes following further delays to any agreement with the EU on a Brexit deal where yet another pencilled-in deadline has been moved.

More on the latest weekend updates below:

Brexit update: EP will not now ratify a trade deal in 2020

Brexit update: EU and UK negotiating teams remain at loggerheads

GBP/USD implications

GBP/USD: Brexit woes, new covid strain hint bear’s return near 31-month high

Cable has, as expected dropped in the open today to prior liquidity in a bearish gap which could provide opportunities on a fade on attempts to close the gap.

Before the open:

At the open:

Author

Ross J Burland

FXStreet

Ross J Burland, born in England, UK, is a sportsman at heart. He played Rugby and Judo for his county, Kent and the South East of England Rugby team.

GBP/USD advances to three-month peak beyond 1.3600

GBP/USD extends its daily rally and trades at its highest level since mid-May above 1.3600. The US Treasury Department decision to double the sice of liquidity support buyback operations for longer-dated nominal coupon securitiez weighs heavily on the US Dollar and helps the pair push higher. Earlier in the day, the data from the UK showed that annual Consumer Price Index (CPI) inflation picked up to 2.9% in July, meeting estimates, while core CPI rose by 2.6% YoY in July versus 2.5% expected.

EUR/USD surges to 11-week high above 1.1650 after US Treasury announcement

EUR/USD gathers bullish momentum and trades at its highest level since early June above 1.1650 on Wednesday. The US Dollar stays under heavy bearish pressure after the US Treasury announced that it will increase the size of liquidity support buyback operations for longer-dated nominal coupon securities. Later in the day, investors will scrutinize FOMC Minutes for fresh clues on policy outlook.

Gold climbs 2% as US Treasury buyback plan pressures long-term yields

Gold (XAU/USD) enters Wednesday’s American trading hours with decent intraday gains, as a softer US Dollar (USD) and a sharp pullback in long-term US Treasury yields help the metal recover all the previous day’s losses.

Crypto Today: Bitcoin, Ethereum, XRP defend key support as ETF inflows return

Bitcoin’s upside remains capped on Wednesday while the downside appears strongly supported above $64,000. The Crypto King’s early week rebound lost momentum near $65,000 as investors assessed the impact of geopolitical tensions in the Middle East.

Fed Minutes expected to shed light on the depth of FOMC hawkish split

The United States (US) Federal Reserve (Fed) will release the Minutes of the July Federal Open Market Committee (FOMC) meeting on Wednesday. The document should allow investors to assess the extent of the hawkish bias within the central bank after a meeting marked by three dissenting votes in favor of a rate hike.

Why is Crude Oil priced for a reopening the ships haven't made?

Fourteen vessels crossed the Strait of Hormuz on Tuesday. Before the war, the count ran near 120 a day. In the sessions since the waterway was publicly declared open, Brent has drifted back to $87 and West Texas Intermediate (WTI) to $81, both a little lower again on Wednesday, with daily momentum on each unwound from the top of its range in late July to the low twenties now.