GBP/USD steady around 1.30 handle as attention stays with coronavirus
GBP/USD has held its own in the face of dollar weakness with the DXY falling back below the 99 handle on Tuesday. The coronavirus is taking up the headlines until the UK and EU trade negotiations and UK budget will take the spotlight next month. At the time of writing, GBP/USD is trading at 1.2995 between 1.2989 and 1.3005 in Tokyo's opening hour on Wednesday.
The markets are hugely distracted from the matter at hand with respect to Brexit, with media headlines taking a rain check from reporting on the matter ahead of the formal negotiation between the EU and UK kick off in March. The coronavirus has taken up the spotlight with the spread of the virus hitting all corners of the world.
GBP/USD Forecast: Next round of sellers aligned around 1.3060
The GBP/USD pair reached a daily high of 1.3017 on the back of the dollar’s weakness and despite soft UK figures. The February UK CBI Distributive Trade Survey on realized sales showed a modest 1.0% increase against the 4.0% expected. The report showed that sales remained flat and orders fell in the year to February, although there has been an improvement in investment plans when compared to the previous quarter.
The EU released the Political Declaration, a document set to be the base of the upcoming trade relationship with the UK. The kingdom will release its declaration next Thursday, although Downing Street responded to the EU, claiming that the UK deserves the same respect to autonomy as other major economies such as Canada and Japan, and mentioned that the EU doesn’t demand a level playing field when dealing with the US. The UK won’t release macroeconomic figures this Wednesday.
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