GBP/USD Weakens as No-Deal Brexit Fears Reginited

GBP/USD is trading close to six week lows as Brexit concerns came back to haunt markets all over again, with Britain's latest actions once

Arslan Butt•Monday, September 14, 2020•1 min read

GBP/USD Weakens as No-Deal Brexit Fears Reginited

Early on Monday, GBP/USD is trading close to six week lows as Brexit concerns came back to haunt markets all over again, with Britain’s latest actions once again raising the possibility of a no-deal Brexit. At the time of writing, GBP/USD is trading around 1.282.

The British government’s recent decision to publish a new legislation to override some terms of the Withdrawal Agreement has increased the chances of not having a trade deal in place with the EU before the transition period ends this year. The move by PM Boris Johnson and his government has met with sharp criticism not only by EU officials but also by former prime ministers of the country, including Tony Blair and John Major.

GBP/USD has also turned bearish as the US dollar trades steady in anticipation of the upcoming Fed policy announcement due later this week. This is the last meeting for the central bank before the upcoming presidential elections and will be worth watching for updates on forecasts for economic growth and inflation for 2023.

Markets are expecting no drastic changes to the Fed’s monetary policy this month but there is a possibility for adjustments to its balance sheet and changes in forward guidance. GBP/USD could also see some moves later this week on the release of retail sales figures from the US.

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ABOUT THE AUTHOR See More

Arslan Butt

Index & Commodity Analyst

Arslan Butt serves as the Lead Commodities and Indices Analyst, bringing a wealth of expertise to the field. With an MBA in Behavioral Finance and active progress towards a Ph.D., Arslan possesses a deep understanding of market dynamics. His professional journey includes a significant role as a senior analyst at a leading brokerage firm, complementing his extensive experience as a market analyst and day trader. Adept in educating others, Arslan has a commendable track record as an instructor and public speaker. His incisive analyses, particularly within the realms of cryptocurrency and forex markets, are showcased across esteemed financial publications such as ForexCrunch, InsideBitcoins, and EconomyWatch, solidifying his reputation in the financial community.