The pound today rallied briefly against the US dollar during the Asian session after the UK Parliament approved the government’s Brexit withdrawal Bill last night. The GBP/USD currency pair’s rally was short-lived as it later fell in the early London session as after the European Union announced a series of meetings to discuss Brexit.
The GBP/USD currency pair today rallied to a high of 1.3091 in the Asian session before falling to a low of 1.3048 in the London session and was within this range at the time of writing.
The currency pair rallied higher earlier today as investors reacted to the vote by UK lawmakers in the House of Commons to approved the current Brexit deal. Many expected Boris Johnson‘s Brexit bill to pass given the strong majority his Conservative Party enjoys after December’s snap elections. However, trade discussions with the EU may not be smooth after the EU’s chief trade negotiator Michel Barnier announced a series of meetings starting today. The block wants to get on the same page before the UK leaves the union on January 31st. Johnson has promised to complete the trade negotiations by December 31st with zero chances of an extension.
Dovish comments by Sylvia Tenreyro a member of the Bank of England‘s top policy making organ, the Monetary Policy Committee also drove the pair lower. Tenreyro echoed the dovish stance outlined by BoE Governor Mark Carney yesterday, which weakened the pound.
The currency pair’s short-term performance is likely to be affected by the release of the US non-farm payrolls report at 13:30 GMT.
The GBP/USD currency pair was trading at 1.3057 as at 11:03 GMT having fallen from a high of 1.3091. The GBP/JPY currency pair was trading at 143.13 having dropped from a high of 143.47.
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Pound Rallies on Brexit Bill Passage, Later Falls on Dovish BoE Stance
