GBP/USD: Three reasons pointing to further falls

FXStreet Team FXStreet

GBP/USD has been plummeting from the highs amid tensions with China. Reports about abandoning Brexit talks are also weighing on sterling while hopes for a vaccine made way to doubts about antibodies, FXStreet’s analyst Yohay Elam informs.

Key quotes

“The US has ordered the closure of China's consulate in Houston. The state department says that it comes amid Intellectual Property (IP) violations – stealing trade secrets. Earlier, images coming of the Texan city showed a fire coming out of the consulate – potentially workers burning documents.”

“The Daily Telegraph reported that PM Boris Johnson's government is contemplating abandoning Brexit talks. Negotiations with Brussels have been stuck in recent months, but both sides have been committing to continuing talks. While this report may be a negotiating tactic, it dampens the mood and weighs on the pound.”

“The encouraging news of the Phase 1/2 trial conducted in collaboration with AstraZeneca has now made a place for some skepticism. Doubts about the efficiency of that vaccine candidate have taken some of the wind out of the pound's gains. Another blow came from the New England Journal of Medicine, which reported that recovered coronavirus patients saw their antibodies fading away after an average of 73 days. The long road toward resolving the issue is weighing on stocks and boosting the dollar.”

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FXStreet Team

FXStreet

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