08/01/2020

Sterling falls as MP's return to Parliament from winter recess


GBP

Sterling fell on Tuesday as British lawmakers returned to Parliament to vote on Prime Minister Boris Johnson’s European Union (EU) withdrawal deal.

After winning an 80-seat majority in last month’s election, it’s likely Johnson’s Conservative Party will pass the bill, analysts say, paving the way for Britain’s exit from the EU on 31st January. There are three days scheduled for a debate before a vote on the bill on Thursday. It will then go to the House of Lords.

Expectations that Britain will finally leave the bloc this month has ended uncertainty about its position and lifted sterling, but the currency is likely to come under pressure again when negotiations about Britain’s EU trade deal begin.

USD

The safe-haven currencies pulled back from recent highs against the dollar on Tuesday as financial markets stabilised, with investors turning more hopeful that tensions between the United States and Iran would not escalate into an all-out war.

Better-than-expected US non-manufacturing sector and factory orders data also lifted the dollar.

The dollar got a boost after data showed the Institute for Supply Management’s non-manufacturing index at 55 in December, up from 53.9 in November and slightly higher than market expectations.

US factory orders, however, fell 0.7% in November, though that was a little better than forecasts of a 0.8% drop.

Key announcements

13.15 – USD: ADP Non-Farm Employment Change; Forecast at 160k against previous of 67k.


Why choose RationalFX?

Based in the heart of London’s financial district Canary Wharf, RationalFX has traded over $10billion in currencies across the globe. Take advantage of our competitive exchange rates, market expertise, suite of FX products and online payment platform when you make bank to bank transfers in over 50 currencies worldwide.

Whatever your reason for making overseas payments, we’re confident our currency specialists can save you time and money while providing peace of mind. Call our team now on: +44 20 7220 8181