GBP/USD plummets to 3-month lows near 1.2850 on latest Brexit headlines


  • Labour spokesman says gaps remain between Labour and government.
  • Retail sales decline in April in the U.S.
  • US Dollar Index clings to daily gains despite the disappointing data.

After piercing through the 1.29 mark, the GBP/USD pair extended its slide and touched its lowest level since February 15 at 1.2852 in the last hour. As of writing, the pair was trading a couple of pips above that level, losing 0.4% on a daily basis.

The latest headlines surrounding cross-party Brexit talks in the UK seem to be weighing on the British pound. A spokesman for the opposition Labour party in the last hour told reporters that gaps remained between the Labour Party and the government in Brexit talks. "We have made it clear that we cannot support the Brexit legislation without an agreement," the spokesman reiterated. Although the fact that the Brexit vote is expected to take place in the first week of June shows that there is still time for sides to come to an agreement, markets don't seem to be convinced that a positive outcome is likely in the near-term.

On the other hand, British Prime Minister Theresa May's spokesman said that discussions with lawmakers across the House to seek to build a majority to pass the Brexit legislation were ongoing.

Meanwhile, the U.S. Census Bureau today reported that retail sales in April declined by 0.2% to fall short of the market expectation for an increase of 0.2%. Nevertheless, the US Dollar Index largely ignored this data and was last up 0.1% on the day at 97.65, making it difficult for the pair to stage a recovery.

Later in the session, the Fed's industrial production and capacity utilization from the U.S. will be looked upon for fresh catalysts.

Technical levels to consider

The pair could face the initial support at 1.2800 (psychological level) ahead of 1.2770 (Feb. 14 low) and 1.2710 (Jan. 8 low). On the upside, resistances are located at 1.2920 (daily high), 1.2960 (200-DMA) and 1.3000 (psychological level/50-DMA).

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility.

Feed news

Latest Forex News

Editors’ Picks

EUR/USD: Trapped in a bull flag on 4H chart

EUR/USD's pullback from Oct.21's high of 1.1179 to 1.1106 has taken the shape of a bull flag on the 4-hour chart. A bull flag represents a pause which usually refreshes higher. A breakout would open the doors for 1.1320. A 4-hour close above 1.1134 would confirm a flag breakout.

EUR/USD News

GBP/USD: Modestly changed to 1.2915 amid fears of UK election

Despite mounting speculations of a general election in the UK, GBP/USD clings to 1.2915 during early Thursday morning in Asia. No major British data highlights the US economic calendar, trade/Brexit news as the key catalysts.

GBP/USD News

USD/JPY declines to 108.60 amid fresh risk aversion, all eyes on the ECB

With the recent uncertainty surrounding the UK’s politics crossing wires, USD/JPY steps back from the previous rise to 108.60 as Tokyo opens for Thursday’s trading session.

USD/JPY News

Gold drops to $1,491 despite downbeat catalysts from Asia, Brexit uncertainty

Despite economic challenges from Asia and uncertainty surrounding the Brexit, Gold prices step back to $1,491 amid Asian session on Thursday. An active economic calendar, including ECB, will be the key.

Gold News

ECB Preview: Draghi's defense of his legacy may drag EUR/USD down

"The ECB is ready to do whatever it takes to preserve the euro." These famous words by Mario Draghi, President of the European Central Bank, are the centerpiece of his legacy.

Read more

Forex MAJORS

Cryptocurrencies

Signatures