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Sterling hits a 6 month high!

• Posted by currencies in Bank of England, Brexit, Currency, Dollar, Economy, EUR, GBP, Sterling, UK, Uncategorised
• December 8, 2017
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Sterling has soared to a 6 month high against the Euro this morning, after news that the UK and the European Union have agreed on a deal to move on to the next stage of the Brexit negotiations.

The European Commission said enough progress had been made after the two sides worked through the night to reach a deal over the status of the Irish border, which had scuppered an earlier attempt to clinch a deal on Monday.

The GBP/USD pair continued with its struggle to gain any strong follow-through traction beyond the key 1.35 psychological mark and had a rather muted reaction to the latest UK manufacturing data.

After data released from the UK showed manufacturing output, which constitutes around 80% of total industrial production, recorded a tepid m-o-m growth of 0.1% in October.

The reading was in-line with consensus estimates but was well below 0.7% growth reported in the previous month, which along with flat-lined industrial production did little to provide any fresh bullish impetus to the British Pound.

Separately, the UK goods trade deficit unexpectedly dropped to £10.78 billion in October, bettering expectations pointing to a deficit of £11.45 billion.

Traders, however, seemed to have largely ignored today’s economic data, with the incoming Brexit headlines turning out to be an exclusive driver of the pair’s movement on the last trading day of the week.