Pound Slides As EU Barnier Hints At 'deadlock' In Brexit Talks
12 October 2017 - 08:13PM
RTTF2
The pound dropped against its key counterparts in the European
session on Thursday, as the European Union's chief Brexit
negotiator Michel Barnier suggested that the negotiations over
financial settlement had reached a "deadlock" and he will not
recommend the start of discussions on future trade relationship
with the EU.
"I am not able in the current circumstances to propose next week
to the European Council that we should start discussions on the
future relationship," Barnier told at a news conference in
Brussels.
Barnier said that agreement was needed on the financial
settlement, EU citizens' rights and the Irish border before moving
into discussions about a future relationship.
The "deadlock" on payments was "disturbing," Barnier said,
adding that there could be "no question of making concessions" on
these issues.
The latest Credit Conditions Survey from the Bank of England
showed that UK banks tightened conditions for unsecured lending to
households and are expected to reduce its availability
significantly at the end of the year.
Meanwhile, availability of secured credit to households
increased slightly in three months to mid-September and lenders
forecast its availability to be unchanged in the fourth
quarter.
The pound was higher against its major rivals in the Asian
session.
The pound hit 3-day lows of 147.30 against the yen and 1.3122
versus the dollar, off its early weekly high of 149.07 and an 8-day
high of 1.3265, respectively. The next possible support for the
pound is seen around 146.00 against the yen and 1.30 against the
greenback.
The pound slipped to a 4-week low of 0.9033 against the euro and
a 6-day low of 1.2784 against the franc, from its early high of
0.8950 and and a 3-day high of 1.2903, respectively. Continuation
of the pound's downtrend may see it challenging support around
0.915 against the euro and 1.265 against the franc.
Looking ahead, at 10:30 am ET, the European Central Bank
President Mario Draghi and Federal Reserve Governor Lael Brainard
participate in a panel discussion about monetary policy at the
Peterson Institute for International Economics, in Washington
DC.
Simultaneously, Federal Reserve Governor Jerome Powell will give
a speech titled "Prospects for Emerging Market Economies in a
Normalizing Global Economy" at the Institute of International
Finance Annual Membership Meeting, in Washington DC.
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