Analysts at Scotiabank explained that Sterling remains generally soft as investors continue to focus on the risk (and consequences) of a “hard Brexit”.
"BoE MPC member Saunders told a parliamentary committee today that the central bank was not concerned about short-term GBP volatility—unless there was a clear impact on prices. This suggests policy makers feel the GBP can continue to play the role of Brexit shock absorber.
GBP/USD short-term technicals: bearish—Cable’s failure to reverse the “flash crash” slide more obviously leaves the GBP at risk of a renewed test below 1.20 near-term, we think. Trend momentum remains universally bearish across a range of time frames. We look for a push back to 1.2200/15 near-term; below here and 1.20 could be reached fairly quickly."
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