CURRENCIES: British Pound Pulls Back From 9-month High As Parliament Votes For Brexit Extension

Date : 14/03/2019 @ 20:43
Source : Dow Jones News

CURRENCIES: British Pound Pulls Back From 9-month High As Parliament Votes For Brexit Extension

By Anneken Tappe, MarketWatch

Dollar snaps losing streak

The British pound on Thursday retraced gains from a day ago as the U.K. Parliament voted to extend a March 29 Brexit deadline, with the retreat in that currency, combined with fresh uncertainty over Sino-American trade negotiations, helping the U.S. dollar to snap a four-session skid.

Don't miss:15 days until Brexit: Here's what happens next (http://www.marketwatch.com/story/15-days-until-brexit-heres-what-happens-next-2019-03-14)

The British pound remained in negative territory Thursday -- having pulled back from a nine-month high hit on Wednesday (http://www.marketwatch.com/story/british-pound-hits-9-month-high-after-parliament-takes-no-deal-brexit-off-table-2019-03-13) -- amid a vote to request a delay of the looming Brexit deadline,with that outcome (http://www.marketwatch.com/story/uk-parliament-backs-brexit-deadline-extension-2019-03-14) widely anticipated by the market.

Sterling last bought $1.3227, down from $1.3337. Against the euro , sterling also slipped, with one euro last buying GBP0.8544, up 0.6%.

However, Michael Hewson, chief market analyst at CMC Markets, said market participants "remain no clearer as to what MPs do want, after this evenings events."

"Attention will now turn to the prospect of another so called meaningful vote on the prime minister's deal, which if it fails again will mean that the prime minister will have to go to the EU council next week and throw herself on the mercy of the leaders of the EU-27 and hope they are feeling generous," Hewson said.

"In terms of its cumulative return week-to-date, the pound has traded like there is a clear way forward to the removal of 'cliff-edge' risk, a 'soft Brexit' or no Brexit. We're not confident there is a clear way forward to anything," wrote Stephen Gallo, European head of FX strategy at BMO.

Parliament's rejection of a no-deal outcome (http://www.marketwatch.com/story/british-parliament-rejects-any-no-deal-brexit-16-days-before-deadline-2019-03-13) was part of three key votes on the U.K.'s exit from the European Union this week. On Tuesday, Parliament rejected Prime Minister Theresa May's Brexit deal.

President Donald Trump, meanwhile, earlier Thursday tweeted that the U.S. was looking forward to negotiating a trade deal with the U.K.

(https://twitter.com/realDonaldTrump/status/1106153554518130688)

During a meeting with Irish Prime Minister Leo Varadkar, Trump also said he was surprised at how badly the Brexit negotiations had gone but that holding a second referendum would be unfair.

Elsewhere on the trade front, a meeting between Trump and Chinese President Xi Jinping has been delayed to at least April, according to a Bloomberg report (https://www.bloomberg.com/news/articles/2019-03-14/china-u-s-said-to-push-back-trump-xi-meeting-to-at-least-april?srnd=premium). The two heads of state were initially expected to meet in March, though a firm date had never been set.

China's yuan weakened against the dollar amid mixed economic data that also weighed on Chinese stocks . One dollar last bought 6.7229 yuan in Beijing, up 0.2%, and 6.7204 yuan in the offshore market, up 0.3%.

The ICE U.S. Dollar Index , a measure of the buck against six major rivals, climbed 0.2% to 96.784 on Thursday, likely notching its first gain in five sessions, as of late Thursday afternoon in New York. The euro slipped 0.2% to $1.1300.

Check out:China stocks and yuan may have more room to rally, says strategist (http://www.marketwatch.com/story/china-stocks-and-yuan-may-have-more-room-to-rally-says-strategist-2019-03-13)

 

(END) Dow Jones Newswires

March 14, 2019 16:28 ET (20:28 GMT)

Copyright (c) 2019 Dow Jones & Company, Inc.
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