Is the Market Bored with Brexit?
The Supreme Court ruled that the decision of Boris Johnson to prorogue Parliament this month lacked reasonable justification, strengthening the pound. However, the Pound sterling has still been under fresh pressure on rising concern over the Brexit limbo. The PM Boris Johnson told MPs on Wednesday that he would not commit to seek for a Brexit extension, calling it the surrender act.
“UK politics remains the centre of attention in sterling markets. While the pound was initially lifted by the Supreme Court ruling, it has settled lower again on market perceptions that uncertainties about outcomes remain high and all possibilities are still on the table” says Hann-Ju Ho, Economist with Lloyds Bank.
GBP/USD Hourly Chart
The GBP/USD reached the highest level at 1.24984 after the release of the Supreme Court decision but stumbled to the lowest level at 1.23442 on the next day 25th September. There has been no sign that the pound sterling will gain its rising momentum and has been still below the level before the Supreme Court’s decision.
With a break of the 1.23 mark, further momentum could carry the Pound lower against the US Dollar, with the next key support sitting at the 1.2230 area. The deadline for Brexit is on the 31st October, which Boris Johnson wishes to stand by.
This week’s jobless claims data has hit unprecedented numbers. The number jumped to 3.28 million. Initial expectations of 1-1.5 million, which was still a very high estimate, were blown out of the water.
The New Zealand Dollar is fighting it’s way back up as the country enters it’s first official day of nationwide lockdown. It posted a 0.67% gain for the trading day, up to 0.58390 cents against the US Dollar. Just a week ago the NZD had dropped to 0.56, and looked ready to hit the 55 cent mark, as news broke of Air New Zealand’s layoffs.
The Nikkei 225, or Japanese Stock Index had an 8% gain for the day, following on from its 7% gain from the previous day. Less than a week ago the Nikkei had just hit lows not seen since 2017, falling below 20,000 points. However in just 2 days it has made back its losses and is now rapidly on the rebound back to the 20,000 mark.
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