Pound Advances After U.K. Reaches Brexit Deal With EU

The pound spiked up against its major opponents in early European deals on Friday, after the U.K. reached a divorce deal with the European Union, setting stage to move on to future trade talks post-Brexit.

European Commission President Jean-Claude Juncker confirmed that enough progress had been made in talks to proceed to the second phase of negotiations.

The deal ruled out a hard border for Northern Ireland and guaranteed the rights of three million EU citizens in the UK. EU27 leaders have to approve the deal on Thursday, to open the next phase of the negotiations. Data on Jobs compiled by the Recruitment and Employment Confederation and IHS Markit showed that permanent job placements in the U.K grew at the fastest pace in three months in November, supported by strong underlying demand for staff. The currency has been trading in a positive territory in the Asian session. The pound advanced to a 1-1/2-year high of 153.41 against the yen and a 6-month high of 0.8690 against the euro, from its early lows of 152.32 and 0.8745, respectively. The pound is likely to find resistance around 156.00 against the yen and 0.84 against the euro.

The pound rose back to 1.3518 against the greenback, heading to pierce its early 4-day high of 1.3520. Continuation of the pound's uptrend may see it challenging resistance around the 1.365 area.

The pound hovered around a 1-1/2-year high of 1.3469 against the franc, compared to Thursday's closing value of 1.3395. Next key resistance for the pound is seen around the 1.36 level.

Looking ahead, Canada housing starts for November, U.S. nonfarm payrolls for November and wholesale inventories for October and University of Michigan's preliminary consumer sentiment for December are set for release in the New York session.