Sterling at a 9-month low against the Euro

Hi everyone,

 

It's the third day in a row that Sterling shows in the red across the board with £-€ being the most notable and significant drop. 1% has been lost in 24 hours and the breach below the longstanding 1.12 level, puts the resistance point now at 1.10. 

With UK MPs now on holiday until September, no real Brexit developments will materialise. The deadline to have a deal in place with the EU is October. Leaving just one month to rush talks, hence why a 'no-deal' is looking likely at this stage. 

For those trading into $, there is a real concern for further losses in the short term. Now the 1.29 levels have been breached, we could see Cable easily slip further the rest of the month.

It is remarkable that the $ is still so strong, because of President Trump's continuing worldwide trade wars and sanctions. But in times of global economic uncertainty, investors seek safe haven currencies. With several rate hikes still expected this year and attractive US treasury bonds, the Dollar is the destination of choice for now.

Most of our readers are Sterling sellers and we hate delivering bad news, but early August could (probably should) be seen as damage limitation if there are payments in the pipeline, as further losses are looking likely at this stage.
 

 

 

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Wednesday, 8th August, 2018

 

12:00 US - Mortgage Applications
15:00 US - Home sales

Thursday, 9th August, 2018


09:00 EU - ECB publishes economic bulletin
13:30 US - Jobless claims & trade balance

Friday, 10th August, 2018

09:30 UK - Trade balance & GDP
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19:00 US - Monthly budget

 
 
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