Foreign Exchange Update 14th September 2020
GBP/USD is trading above 1.28, boosted by optimistic market sentiment ahead of a key debate in parliament. The pair could stabilise in the coming days, after Brexit talks escalated late last week. The Pound posted its worst week, lifting the Dollar. Members of parliament are due to discuss a problematic Brexit ‘no-deal’ scenario which would violate the EU divorce treaty.
The Euro-to-Dollar exchange rate is trading slightly below 1.1850. The pair underperformed last week, as the Sterling lost and weakness in the stock markets paired with the European Central Bank’s currency concerns weighed heavily on the Euro. However, market sentiment remains bullish amid hopes of a coronavirus vaccine being made available soon, despite rising cases in the bloc.
GBP/EUR is trading at a spot rate of 1.0799 at the time of writing and could stabilise in the coming days after posting its worst week since March. The British currency has suffered substantial technical damage on the charts, and risks further battering before seeing any kind of recovery. The Pound was down almost four percent against the eurozone’s common currency, after the UK government sought through its Internal Market Bill.
Elsewhere, the Pound-to-Canadian Dollar was seen fighting for support after posting its steepest decline in six months. The pair was seen trading at 1.6852 at the time of writing, with ‘no-deal’ Brexit risks overshadowing a potential Sterling recovery. GBP/CAD may have also been pushed down by losses in Canadian exchange rates ahead of the weekend.