Sterling rises against US dollar and euro amid hopes of a Brexit deal
Sterling rose against the US dollar and the euro today, boosted by hopes that a no-deal Brexit could be avoided.
GBP is up 0.74 per cent on the US dollar and 0.72 per cent on the euro this afternoon following three days of losses.
David Madden, a market analyst at CMC Markets UK, said a mixture of short covering and mild optimism surrounding the Johnson-von der Leyen meeting this evening had assisted the dollar and sterling.
Over the next few days Madden said sterling will be sensitive to the UK-EU trade situation. “Seeing as GBP/USD is only 0.66 per cent away from the recent 31 month high, it seems the markets are pricing in a deal,” he added.
Boris Johnson will have dinner with the President of the European Commission Ursula von der Leyen this evening. Michael Gove, the minister for the Cabinet Office, earlier today said there was an agreement in principle on all outstanding issues in the UK-EU Withdrawal Agreement Joint Committee, including the issue of Northern Ireland and the Irish border.
This means that the government has dropped controversial clauses in the Internal Market Bill and ministers will no longer have the power to unilaterally override the Brexit divorce treaty.
Elsewhere global stocks reached record highs on Wednesday as investors hailed efforts to provide more fiscal stimulus and positive news on Covid-19 vaccines.
The FTSE 100 opened higher as Johnson prepared to fly to Brussels, climbing 0.3 per cent to 6,580 points in early trading.
The FTSE 250 index of mid-cap firms rose 0.4 per cent.