OctaFX | OctaFX Forex Broker
Open trading account
Back

UK to reach an agreement on transition deal and how to play it? - Nomura

Conclusion and strategy on UK politics and GBP's reaction.

Key Quotes:

"Our main scenario remains that the UK and EU reach an agreement on the transition deal, but in the near term UK politics will likely be the main driver of GBP. In fact, GBP’s reaction to UK politics and our Brexit stress tracker is rising again. 

The estimated sensitivity is still more muted than it was a year ago, but now GBP’s negative reaction is more concentrated against the traditional safe-haven currencies, CHF and JPY. 

Thus, if UK political uncertainty continues to rise, CHF and JPY should face appreciation pressure into the important EU summit on 14-15 December. If an agreement is reached then, we would expect a small relief rally in GBP/CHF and GBP/JPY. 

UK political uncertainty should also put slight downside pressure on EUR/JPY for the time being, although we still expect EUR/JPY appreciation into 2018 and we keep our EUR/JPY long recommendation."

British Brexit minister Davis: We can go further than Canada-EU free trade agreement

British Brexit minister David Davis crossed the wires in the last hour, saying that they could go further than Canada-EU free trade agreement. Key qu
Read more Previous

An emerging theme for 2018? - ANZ

Analysts at ANZ explained that one of the ongoing talking points in markets domestically of late has been the likely changes to the RBNZ’s mandate and
Read more Next
Start livechat