- EUR/GBP trends higher at the start of the week, as the pair continues to pick up from last week’s 3 month low
- No-deal Brexit fears are rising offering support to the pair
Pound weakness picked up pushing EUR/GBP to a weekly high around 0.8960.
The pair is seeing buying interest on Monday, adding to last weeks’ recovery around 0.8865, a three-month low. The rally in EUR/GBP was helped along by selling pressure in the Pound amid rising no trade deal Brexit fears.
UK Brexit negotiator David Frost stated that the UK is not afraid of a no deal Brexit. Boris Johnson also set a deadline for a free trade deal to be agreed with the EU by the October 15, as reported in the Telegraph.
These Brexit bombshells come following dovish comments by BoE’s Michael Saunders last week. BoE policy maker Michael Saunders said the central bank was likely to up their unprecedented emergency support measures over the next few months in a bid to boost inflation.
Meanwhile, the euro was also out of favour amid ECB concerns over the value of the common currency. Last week, the ECB Chief Economist Philip Lane said that value of the Euro is relevant for monetary policy.
Investors will now turn their attention to the ECB’s monetary policy decision on Thursday. Prior to Thursday Brexit headlines will drive movement in the Pound potentially producing some trading opportunities.