Pound to US Dollar exchange rate supported after Gridlock in UK Parliament

Pound to US Dollar exchange rate supported after Gridlock in UK Parliament

Pound finds support above the 1.20 benchmark against the US Dollar following more Brexit chaos

The pound to US dollar exchange rate has rallied higher to above 1.2150 for the GBP/USD pair as Brexit tensions reach boiling point in the House of Commons. With 57 days to go to the 31st October 2019 deadline the stakes are high after UK Prime minister Boris Johnson lost his first parliamentary vote last night by 328 to 301 votes. 21 Conservative rebels voted against the government despite having the whip removed and will face deselection in any future general election. It has prompted Boris Johnson to call for a general election although the leader of the opposition Jeremy Corbyn has said the Labour party would only support an election once no deal had been taken off the table.

Key Brexit vote in Parliament today: What could happen?

It leaves an uncertain period ahead whilst no deal is attempted to be taken off the table by the so-called rebel alliance. Today faces another day of uncertainty and volatility as parliament votes on a bill that will effectively extend Brexit to the end of January 2020 something the Prime Minister has vowed he will not tolerate. Rates for GBP/USD continue to pivot on whether or not there will be a deal between Britain and the EU. There are so many potential different outcomes from these latest twists and turns making it almost impossible to predict. As such high volatility is to be expected for pound to US dollar exchange rates once a way forward is established and the market movement could be in either direction.

US Non-Farm Payroll figures released Friday

Whilst Brexit is expected to dominate the headlines today and tomorrow the US will see the release of non-farm payroll numbers on Friday and could create some movement for GBP/USD rates. Yesterday the dollar came under pressure after disappointing manufacturing data with the US China trade war being cited as having a negative impact. The payroll numbers on Friday will be keenly awaited as the outcome will likely carry sway with the US Federal Reserve which will be meeting later this month and where an interest rate cut is widely expected.
Those with pending requirements to either buy or sell dollars would be wise to consider their option in such an eventful week in British politics as well as with key data releases for the US.

Those with pending requirements to either buy or sell dollars would be wise to consider their option in such an eventful week in British politics as well as with key data releases for the US.