The pound sterling turned up on the Brexit latest news and then fell down. On June 23, 2016, a referendum was held as to exit of Britain from the European Union, at which it was decided that the United Kingdom would leave the European Union, and a long-standing dispute over the place of kingdom in the EU would be put to an end.
Such unexpected results of the British referendum on secession from the European Union caused a real fever. The course of British currency against the dollar collapsed by 10% in just a couple of hours, pound sterling became the most “failed” major currency by the end of 2016. According to Brexit latest news, brokers sharply raised margin requirements, and a period of abnormal volatility in the market lasted more than one week.
Brexit Latest News Affected The Dollar And Pound Sterling
The referendum was held in June 2016, it was supported by 51.9%. It was assumed that the United Kingdom would leave the EU on March 29, 2019, but these dates have been shifted. The leaders of 27 EU countries have agreed on a deferment on Brexit. Based on the Brexit latest news, the dollar fell to a basket of major currencies in March 2019, after the EU agreed to postpone Brexit but only on the condition that British parliament approves an agreement with Brussels about the exit. Later it became known that the UK adopted the EU Brexit scripts. The Brexit deal was previously rejected twice by the UK Parliament (January 15 and March 12).
As a result of such Brexit latest news, on the morning of March 22, the dollar index versus the currency basket fell by 0.2% to 96.29%. Simultaneously, the decision of the EU leaders had a positive effect on the course of pound sterling. It added 0.3 percent and rose to $ 1.31, the day before dropping to $ 1.3. Bank of England left rates unchanged. The British central bank said that most companies feel most ready to leave the UK from the EU without a deal, although this is likely to hit growth and jobs. The dollar traded without sharp fluctuations to yen at 110.80. Euro added 0.04 percent to 1.14 dollars after a decline of about 0.3% in the previous session.
Sterling Fell, As Cross-Party Talks About Brexit Were Unsuccessful
Conservatives and laborists could not come to a common decision on the agreement on British exit from the EU. Political instability in the UK and uncertainty about Brexit continued to put pressure on the pound. Under a double press and Brexit trade talks, pound sterling fell during the auction on May 21 to its lowest level since January 15 – 1.2688 per dollar. Parliamentarians delivered a new blow to the British currency: leaders of the Conservative and Labor Party held talks, but were unable to reach a common denominator about Brexit deal. Labour Brexit negotiator is unwilling to support Theresa May’s plan to exit the country from the EU.
Market Is “Tired”
The fall of pound, after the announcement of the results of the referendum in Brexit latest news, was sharp and very significant. It fell against dollar from 1.50 to 1.37 USD in just two hours. None of the major currencies in history showed such a bad two-hour chart. In relation to euro, the decline was 7%. Some minor currencies, for example, the South African rand, and the largest stock indices, including DowJones (-2.5% per half hour) and FTSE 100 (-5% in two days), also collapsed. Based on Brexit latest news, panic on the stock markets led to the largest one-day losses in history — over $ 2 trillion.
However, after this, the recovery period began. Stock indices returned to “pre-Brexit” values after a couple of weeks, and the pound, by now, played half the drawdown against the dollar. The EURGBP pair is hovering around the “post-Brexit” lows. At the same time, the market’s response to news on Brexit is much weaker than on the initial results of the referendum. Online casino business did not suffer a lot, as the UK and EU citizens continued to gamble online in British and European casinos like casino på nett. But parliament Brexit vote, announcing a “deal”, postponing a “deadline” – all this causes volatility jumps in the market, but the final changes in the pound exchange rate after the Brexit latest news today do not exceed one percent.
But, due to the unpredictability of the British currency rate fluctuations at the Brexit latest news release, it would be a good idea to exit the market on the eve of another news and come back only after a steady trend has been formed, don’t you think so?
- Correlation of Pound Sterling And Cross-Party Brexit Talks - July 23, 2019