The Pound Sterling failed to maintain positive momentum and gave back a portion of yesterday’s gains as market worries grow over the impending Brexit deadline. Though Angela Merkel, the Germany Chancellor, had suggested yesterday that the EU might be willing to negotiate the Brexit deal, market players remain highly skeptical. Ahead of this weekend’s G7 meeting, Merkel will be meeting with Boris Johnson who, analysts say, is likely to insist that the Brexit deal be changed otherwise Britain will withdraw.
As reported at 10:47 am (GMT) in London, the GBP/USD was trading lower at $1.2132, down 0.2598%, and well off the earlier peak of $1.2175, while the trough for the trading day was recorded at $1.2129. The EUR/GBP was trading at 0.9148 Pence, a gain of 0.3026%; the pair has ranged from 0.91164 Pence to 0.91500 Pence in this session.
Merkel Likely Unyielding
According to media reports, Merkel will not be willing to open up the discussion to more than just the matter of the Irish trade backstop. Johnson had said that the original agreement was unacceptable, so markets are hopeful that a work-around can be negotiated. Some currency strategists believe that the German Chancellor will be relatively immovable on the substantive matters, however, which will further pressure Sterling trade.