UK Brexit Party Leader Farage stand aside in Tory seats
USTA Navarro says there is no agreement to rollback any existing tariffs as part of Phase One deal
UK economy dodges recession, but annual GDP slowest since 2010
Choppy start of the trading week with a couple of interesting headlines on the UK General Election front and some more conservative comments form US Trade Officials during the weekend on the US-China front. The highlight on today's economic calendar was the release of the UK GDP numbers which point out to the slowest pace of expansion since 2010, however GBP gained against the USD after Brexit party leader Farage announced that he will seat aside in General Election campaign to avoid damaging Boris Jhonson's effort to secure a parliamentary majority to end the Brexit impasse. Today's move in the pound is another evidence how low-significance was last week dovish BOE rate hold and how careless are traders about UK data, constantly overshadowed by the current Brexit development.
However, I think we are entering an interesting phase for cable were fundamentals will eventually regain focus and drive the UK currency. Everyone agrees at this point that if BOJO delivers Brexit - given the pound current positioning - GBP could get up to the 1.34 area due to the heavy unwinding of short positions. However, thinking long term, there is still a lot to process for GBP traders in the assessment of the current UK business cycle, especially when the economic consequences of the current deal are yet to materialise. Nice and doodle!
If you missed the morning briefing from the desk click HERE