Brexit Bears Dominate GBP: Forex Morning Report

Today, during the Asian session, the EUR/USD pair is growing slightly, being correcting after yesterday’s decline, which led to the renewing of local lows from December 2, 2019. Now, EUR has added about 0.04%, testing the level of 1.1020 for a breakout. The reason for Monday’s weakening of the euro was the poor macroeconomic statistics from Germany. So, the German Ifo Business Climate Index in January fell from 96.3 to 95.9 points with a forecast of 97 points. The index of economic expectations for the same period fell from 93.9 to 92.9 points, while investors expected its growth to 95 points. The current situation assessment index rose from 98.8 to 99.1 points, which also turned out to be slightly worse than analysts’ expectations of 99.2 points.


Today, during the Asian session, the GBP/USD pair is trading near zero, continuing the development of a “bearish” impulse that formed in the middle of the last trading week. GBP is under pressure of the uncertain prospects for Britain’s upcoming exit from the EU and protracted trade negotiations, which will determine the country’s access to European markets. Yesterday, the British currency was slightly supported by Gross Mortgage Approvals from the BBA. At the end of December, the indicator rose from 44.058K to 46.815K, which turned out to be better than market expectations. On Tuesday, investors are focused on the CBI Distributive Trades Survey release for January.

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Today, during the Asian session, the AUD/USD pair shows an ambiguous dynamics of trading after a steady yesterday’s weakening. At the opening, the instrument declined and renewed the local lows since October 16, 2019, but then it managed to recover very quickly and is now trying to enter the green zone. At the same time, Australian macroeconomic statistics were poor. Thus, the National Bank of Australia confidence index in the business environment in December fell from 0 to –2 points against the forecast of growth to 1 point. The index of conditions for the same period was corrected from 4 to 3 points, which met the expectations of analysts. Today, traders are focused on US Durable Goods Orders release. Australian investors are expecting Wednesday when Q4 2019 inflation report will be published.


During the Asian session, the USD/JPY pair is growing, continuing to develop the “bullish” momentum formed at the beginning of the week. Now, the dollar has added about 0.09%, testing the level of 109.00 for a breakout. The growth of the instrument is facilitated by an increase in interest in risk, while US macroeconomic statistics remain ambiguous. So, New Home Sales for December fell by 0.4% MoM after falling by 1.1% MoM last month. Analysts expected a growth rate of 1.5% MoM. Dallas Fed Manufacturing Business Index for January rose from –3.2 to –0.2 points against the forecast of –3.1 points.


During the Asian session, gold prices are moderately falling, continuing a poor correctional impulse formed after a positive gap at the opening of this week. The price is supported by the uncertainty caused by the outbreak of coronavirus in China. In addition, investors expect a meeting of the US Federal Reserve this week (January 28–29) but it is assumed that rates will remain unchanged, as recent macroeconomic data indicate the continuation of positive trends in the US economy.

Jason P. Vasser

Jason P. Vasser

Jason P. Vasser gives us an analysis into the recent geo-political news hitting the services, legal, and technology sectors. He has been an financial advisor for over 10 years in the NYC and in recently turned his experience investment and passion for journalism into a full time role. His responsibility is for the analysis of companies and writing valuable information for shareholder community.Jason is an a seasoned writer who has a passion for tech and travel. His goal is to see travel the world and report on the use of technology from a market perspective.