GBP/USD revisits sub-1.3300 area as UK MPs eye deadline extension

  • GBP/USD trades near 1.3250 ahead of London open on Thursday.
  • The pair failed to hold previous gains as investors doubt Brexit progress.
  • While 1.3380 can limit the pair’s near-term upside, 1.3220 may offer immediate support.

The British Pound (GBP) declines to 1.3250 versus the US Dollar (USD) while heading towards European session on Thursday. The GBP/USD pair failed to sustain previous-day rally as traders doubt the British lawmakers’ ability to agree on a Brexit plan now that they have already rejected PM May’s proposal ahead of closing the door for no deal Brexit. Investors may concentrate on how the UK members of parliament (MPs) can agree over delaying Article 50 deadline today.

Lesser than forecast growth of the US durable goods orders ex-transportation and producer price index (PPI) gave an initial boost to the British Pound (GBP) versus the US Dollar (USD) on Wednesday. The moves got additional support after the markets welcomed the British MPs rejecting no-deal Brexit.

Though, the sterling couldn’t remain strong for long as comments from the UK PM Theresa May signaled she had fewer options available for a fresh deal, which in turn means less alteration to her recently rejected the proposal. It should also be noted that the EU Commission chief Jean-Claude Juncker had previously said that there are lesser chances of entertaining UK’s renegotiation demand for third time. Adding to pessimism were the doubts about how long the Brexit can be stretched if at all MPs vote for extending Article 50 date from March 29 in today’s voting.

It is much anticipated that PM May could ask for two months of extension from the EU, if today’s vote receives the support and MPs keep rejecting her old plan (with few adjustments making it the third meaningful vote).

Hence, uncertainties prevail about how the UK policymakers can get a deal through in a few weeks or months that they couldn’t do in recent years.

From the US, the recent comments from the secretary of state criticizing China continue to raise doubts on a successful trade deal between the world’s two largest economies and negatively affect the USD.

On the data front, initial jobless claims for the week ending on March 04 and January month new home sales are on cards. Initial jobless claims may rise a bit to 225K from 223K whereas new home sales could remain mostly unchanged around 0.620M versus 0.621M prior.

GBP/USD Technical Analysis

Successful break of 1.3380 becomes pre-requisite for the GBP/USD pair to aim for 1.3450 and 1.3510 resistances.

On the downside, 1.3220, 1.3180 and 10.3150 are likely immediate supports for the pair traders to watch.

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 under pressure near 1.1380 ahead of Powell

EUR/USD sees fresh selling and tests daily lows near 1.1380 region amid a broad-based US dollar comeback, as all eyes remain on the Fed Chair Powell's speech for fresh insights on the US interest rates outlook. 


GBP/USD keeps gains near 1.2760 post-UK data

The GBP/USD pair keeps the bid tone intact near the 1.2760 region despite a sharp drop in the UK CBI Retailing Reported Sales and broad US dollar recovery. Eyes on Powell's speech. 


USD/JPY: bearish movement still far from a bottom

The USD/JPY pair remained under some selling pressure on Tuesday and dropped to fresh multi-month lows during the Asian session, albeit recovered few pips thereafter. BOJ considered the risks of prolonged stimulus as inflation refuses to pick up.


Gold consolidates recent upsurge to multi-year tops, comfortable above $1400 mark

Gold adds to the post-FOMC upsurge amid escalating geopolitical tensions. A modest USD uptick/stability in equity markets prompts some profit-taking. The downside remains limited ahead of Powell’s speech later this Tuesday.

Gold News

US Conference Board Consumer Confidence Preview: Employment sustains optimism

Income gains, employment and general economic prosperity support confidence. Decline in Q2 GDP not impacting sentiment. Low inflation and faling interest rates are positive consumer trends.

Read more