Pound US Dollar (GBP/USD) Exchange Rate Rises as Cross-Party Negotiations Continue
The Pound Sterling US Dollar (GBP/USD) exchange rate edged up on Monday morning, and the pairing is currently trading at an inter-bank rate of $1.3061.
Cross-party talks between the Prime Minister and Labour leader Jeremy Corbyn will continue today with the aim of breaking Brexit deadlock.
This likely sparked Brexit optimism as time is running out with just five days before the UK is due to leave the EU.
On Sunday, Theresa May tweeted a video message explaining her reasons for negotiating with Labour.
In the video, May said:
‘We absolutely must leave the European Union […] that means we need to get a deal over the line and that’s why we’ve been looking for new ways – a new approach – to find an agreement in Parliament.
‘People didn’t vote on party lines when it came to the Brexit referendum. And I think members of the public want to see their politicians working together more often.’
US Dollar (USD) Falls on US-China Trade Talk Optimism
Reports emerged stating that the US-China trade discussions will continue this week via video link in order for the two countries to ‘resolve outstanding issues.’
Washington has said that there was still ‘significant work’ to be done in trade talks with Beijing, although the optimism likely sparked an increase in global risk appetite weighing on the safe-haven USD.
Last week, face-to-face talks were labeled as successful, with topics such as intellectual property, non-tariff barriers, and forced technology transfer being discussed by US and Chinese Officials.
On Thursday US President Donald Trump said that a trade deal would be announced within the next four weeks.
Commenting on progress made last week, White House Advisor Larry Kudlow said:
‘We are making headway in a lot of areas. That includes enforcement, that includes IP [intellectual property] theft, that includes forced technology transfers, ownership, cyberspace, commodities and all the rest of it.
‘Those are of course in the middle of the negotiations that are ongoing but we’ve come further and farther than ever before.’
Pound US Dollar Outlook: Will the GBP/USD Exchange Rate Rise on Disappointing US Factory Orders?
Looking ahead to this afternoon, the US Dollar (USD) could slide against the Pound (GBP) following the release of US factory orders data.
If February’s factory orders fall by -0.6% as forecast, it could dampen sentiment in the ‘Greenback’.
Brexit is likely to remain one of the main catalysts for movement of Sterling over the course of the session, and today the House of Lords will vote on the Brexit delay Bill.
If the House of Lords vote in favour of the Bill proposed by Labour’s Yvette Cooper, it would force the Prime Minister to request an extension.
The Bill also diminishes the risk of a no-deal which would likely cause the Pound US Dollar (GBP/USD) exchange rate to rise.