GBP/USD jumps to session tops and retreats, finds some resistance ahead of mid-1.2900s
The selling bias surrounding the greenback picked up pace in the last hour and lifted the GBP/USD pair to fresh session tops, closer to mid-1.2900s.
The prevailing risk-off mood – amid growing concerns over the global outbreak of the deadly coronavirus – led to an extension of the recent slump in the US Treasury bond yields. In fact, the yield on the benchmark 10-year government bond fell to fresh all-time lows and kept exerting some pressure on the US dollar.
Shares and yields slide in coronavirus spotlight, Sterling a haven?
Ironically Brexit has made the British pound a haven from coronavirus fears. Sterling is virtually unchanged against the dollar this year and well up versus the euro. We still expect the pound to fall on bad news about Brexit talks but there is a benefit in it being uncorrelated to coronavirus concerns. The most recent comments from the EU’s Chief Brexit Negotiator Barnier were a little more constructive.
GBP/USD Forecast: Seems vulnerable ahead of UK's Brexit negotiating mandate
The GBP/USD pair came under some heavy selling pressure on Wednesday and reversed the previous day's goodish intraday positive move to one-week tops – levels just above the key 1.30 psychological mark. The downfall lacked any obvious catalyst and was sponsored by fears of a no-deal Brexit, further fueled by the UK’s diverging stance over the future trade relationship with the European Union (EU).
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