Sterling bulls were encouraged by news that the top negotiator in the EU commented on Monday that an agreement for a favorable departure for Britain could soon be forthcoming. Concerns that the split could be unfavorable to the UK government and hence, the UK economy, have kept the Pound under significant pressure so this news came as welcome relief.
As reported at 10:40 am (JST) in Tokyo, the GBP/USD was trading at $1.3024, down 0.05% and off the earlier peak of $1.3040 while the low is at $1.3021. The EUR/GBP was trading at 0.88906 Pence, down 0.11%; the pair has ranged from a low of 0.88900 Pence to a high of 0.89030 Pence.
ECB Meeting in Focus
The Euro was able to climb higher after worries over Italy's sovereign debt seemed to fade. That in turn narrowed the yield between German bunds and Italian bonds. The EUR/USD was trading at $1.16, down 0.04%. Later this week, markets will focus on the upcoming monetary policy decision from the European Central Bank. While the ECB is still expected to hold rates at their current levels at this meeting, Mario Draghi will set the stage for an additional rate hike in the coming months, despite some concerns which could impact the EU economy, not the least of which are the political tensions in Italy and the global trade tensions.