Forex – Pound Rises On Reports of Tentative Brexit Deal on Financial Services

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Forex - Pound Rises On Reports of Tentative Brexit Deal on Financial Services

iq-option.trading – The British pound rose on Thursday on reports that UK Prime Minister Theresa has struck a deal with the European Union on financial services.

The GBP/USD pair was up 0.69% at 1.2854 by 12:30 AM ET (04:30 GMT), while the EUR/USD pair also gained 0.3%.

Citing government sources, the Times reported on Thursday that May and the European Union reached an agreement on a tentative deal that would give UK financial services companies continued access to European markets after Brexit.

Meanwhile, the Chinese yuan rose against the dollar as the People’s Bank of China (PBOC) set the yuan reference rate at 6.9670 vs the previous day’s fix of 6.9646.

Chinese President Xi Jinping said on Wednesday that Beijing should take steps to counter recent changing economic situation as downward pressure is increasing. His comments came after data on Wednesday showed China’s manufacturing sector expanded at a slower pace in October.

The Chinese currency hit its weakest since the global financial crisis on Wednesday, at 6.9748 per dollar.

“Even if we see clear signals that the Chinese central bank is against a depreciation of the renminbi, the depreciation pressure is not easing,” wrote Zhou Hao, senior emerging market economist at Commerzbank (DE:CBKG) in Singapore, in a client note.

“Nevertheless, we continue to believe that the PBoC will not abandon the psychologically significant 7 mark easily. This could trigger a capital flight that would make it all the more difficult for Chinese leaders to maintain financial stability,” he added.

Elsewhere, the AUD/USD pair gained 0.8%. The Caixin China manufacturing PMI, which managed to hold above the key 50 thresholds for the 17th straight month in October, was cited as supporting the Australian currency.

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