GBP/USD Trades Volatile Even as Markets Hope for a Breakthrough Towards a Brexit Deal
At the start of a fresh trading week, the pound traded strong against the US dollar over rising optimism that a Brexit deal can be worked out before the October 31 deadline. However, GBP/USD has slid lower and is now trading at around 1.257 at the time of writing over worries about whether a Brexit deal can be worked out in time.
Even as markets cheer last week’s developments between UK Boris Johnson and Irish PM Leo Varadkar, Johnson has signaled that there is still considerable work to be done towards finalizing a deal on Brexit. The upcoming EU summit on October 17 is a crucial one as the parliament gets ready to vote on any deal reached between BoJo and the EU during this time.
Intense discussions continue between officials from both sides over the weekend and into this week. Meanwhile, EU’s chief negotiator Michael Barnier stated that UK’s plans to track goods as part of the customs arrangements on the Irish border were unacceptable to the Union.
All’s not well just yet in terms of a Brexit deal and the EU is prepared for all scenarios even as negotiations remain ongoing. For the first time in several months, EU27 nations discussed the possibility of granting the UK yet another extension on Brexit to conduct a round of general elections.
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