Pound Extends Gains on Hopes for May's Plan B

Pound Extends Gains on Hopes for May's Plan B


The British Pound gained against majors after The Sun reported that Northern Ireland's DUP would provide conditional backing for May's Brexit Deal next week. The latest developments were enough to increase investors' appetite towards the British pound. The GBPUSD traded at an eleven-week high of $1.3139, and the GBPJPY rose to a six-week high of 144.22.


The euro weakened against peers following a dovish press conference from the European Central Bank President Mario Draghi. Draghi said that the incoming economic data have continued to be weaker than expected, growth is likely to be weaker in the short term, and risks around the Eurozone outlook have moved to the downside. These comments were enough to drive the EURUSD below $1.13 level. The EURUSD touched a six-week low of $1.1290, and the EURGBP tumbled to 0.8617, the lowest since May 2017.


Gold prices were little unchanged as investors await further fundamental drivers. The precious metal remains caught in a $25 range, silver traded at a high of $15.40, and palladium dropped to $1320.


Oil prices surged as the United States signaled that it could impose sanctions on Venezuela. The recent political and economic turmoil affected Venezuela's crude exports. On the other hand, the Energy Information Administration reported that the US weekly crude oil inventories rose by 7.970 million barrels last week, while production remained at a record high of 11.9 million barrels per day. The West Texas Intermediate crude futures climbed to a high of $53.91, and Brent futures traded at a high of $61.91.

Major Economic Events

GMT Country Event Expectation Previous
9:00 EU German Ifo Business Climate Index 100.7 101
13:30 US Core Durable Goods Orders (MoM) (Dec) 0.3% 0.4%
15:00 US New Home Sales (Nov) 560 544
18:00 US U.S. Baker Hughes Oil Rig Count   852


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