ICM: Pound Tumbles to an Eleven-Month Low on Higher Chances of “No Deal” Brexit

ICM, the leading London-based FX and CFDs provider, stated that the British Pound was the weakest performer among major currencies as the likelihood of Britain leaving the European Union without a deal increased. The New Zealand dollar fell to a multi-year low against the United States dollar on dovish Reserve Bank of New Zealand.

The Sterling fell to its lowest level in eleven months against the United States Dollar and the Japanese Yen. The chances of a Brexit without a deal are becoming higher as time is passing by. The Bank of England governor, Mark Carney, addressed the “uncomfortably high risk” of leaving the EU with no deal. It could force the bank to ease its monetary policy to support the economy. As per ICM trading platform, the GBPUSD tumbled to $1.2852 during the Asian session, the lowest level since August 31st. Moreover, the GBPJPY traded at a low of 142.35, the lowest since September 11.

ICM highlighted that the dollar index which measures the greenback against a basket of major currencies covered most of Tuesday’s losses earlier yesterday, but the index faded gains and ended the day in the red zone at 95.05. DXY is trading in a tight range between 95 and 95.55 due to the lack of major fundamentals which could allow the index to break higher or lower. Market participants await the July inflation numbers to grasp clues about the interest rates path. As per ICM trading platform, the dollar traded at a two-week low of 110.70 against the Japanese Yen. On the other hand, the dollar continued higher against the Russian Ruble and the Turkish Lira where USDRUB reached a 21-month high of 66.74, and the USDTRY traded at a new record high of 5.44.

The Reserve Bank of New Zealand left its interest rate unchanged at 1.75% and lowered its outlook for rates. The RBNZ said that the official cash rate is expected to remain at this level till 2020, and repeated that the next move could be up or down.  As per ICM trading platform, the NZDUSD traded at a low of $0.6654, its lowest level since March 2016.

Metal prices remain in a tight trading range near 2018 lows. The gold ounce was slightly higher yesterday and closed at $1214, and the silver ounce also settled higher at $15.42. However, metals could remain under pressure as the economic outlook of the United States strengthens.

Oil prices dropped despite the slump in US crude inventories. The Energy Information Administration reported yesterday that the US weekly crude oil inventories fell by 1.351 million barrels. As per ICM trading platform, the West Texas Intermediate crude futures traded at $66.32 per barrel, its lowest level since late June, and the Brent futures fell to a three-week low of $71.66 per barrel.

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