EUR/GBP jumps to 0.9050 with Brexit talks set to continue until Sunday

A bout of GBP weakness has taken EUR/GBP sharply higher to the 0.9050 level in recent trade.
Spurring the move was the news that Johnson/von der Leyen Brexit talks could not close any gaps.

Joel Frank Independent Analyst

During early Thursday Asia trade, EUR/GBP has popped higher to around 0.9050 from just above 0.9000 amid a bout of GBP weakness. The pair currently trades with gains of around 30 pips or just under 0.4%.

Brexit talks to continue until Thursday

Immediately after UK PM Boris Johnson’s departure from the European Commission headquarters in Brussels, a senior UK source told the media that “very large gaps remain” between the two sides and it is “still unclear whether these can be bridged”. In other words, zero progress was made in top-level talks tonight, which seems to have deflated GBP somewhat. EU and UK officials quickly confirmed this.

More positively, however, talks will continue over the coming days between negotiating teams, as neither the EU or UK wants to leave any possible route to a deal untested. Johnson and von der Leyen agreed that by Sunday, a firm decision should be taken about the future of talks. So, as expected, the can has been kicked down the road and Sunday is the new “make or break” moment for markets.

EUR/GBP remains supported above 0.9000 amid continued Brexit impasse

It seems as though EUR/GBP is going to struggle to break back below 0.9000 in the coming days in the absence of any Brexit deal, the pair having twice briefly dipped below this level since last Friday before buyers aggressively pushed the cross back to the upside. Meanwhile, further Brexit pessimism might fuel a test of recent highs around 0.9140.

Author

Joel Frank

Independent Analyst

Joel Frank is an economics graduate from the University of Birmingham and has worked as a full-time financial market analyst since 2018, specialising in the coverage of how developments in the global economy impact financial asset

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