GBP/USD has edged lower in the Monday session. In North American trade, the pair is trading at 1.2844, up 0.11% on the day. On the release front, British Rightmove HPI posted a sharp decline of -1.7%. In the U.S., there are no major events on the schedule. On Tuesday, the U.S. releases building permits and housing starts.
Brexit jitters hit full force on Thursday, and the pound responded with sharp losses. The currency plunged 1.65% on Thursday after Brexit Secretary Dominic Raab resigned in protest of the draft Brexit agreement between the U.K and the European Union. It promises to be an uphill battle for May, as many Conservative MPs are against the agreement, particularly over the proposed customs agreement with the EU. On Thursday, there were calls from some Conservative MPs for a no-confidence vote against May, and it’s unclear if May will survive the latest crisis. With Labor vowing to shoot down the agreement, May will have a tough time getting a majority in parliament for the agreement. The EU announced that a special summit on Brexit on November 25, but the markets remained concerned that a ‘no-deal’ scenario is a real possibility. GBP/USD posted its sharpest one-day loss of 2018 on Thursday, and further tensions over Brexit could push the pound lower.
Overshadowed by the political drama in Westminster was a dismal reading from British retail sales on Thursday. The indicator came in at -0.5%, its second straight decline. Consumers are nervous about Brexit and are holding tighter to their purse strings. As well, the mild autumn weather has put a damper on sales of winter clothes. The dismal retail sales release could dampen consumer and investor confidence, which could push the wobbly pound even lower.
Sunday (November 18)
- 19:01 British Rightmove HPI. Actual -1.7%
Monday (November 19)
- 10:00 US NAHB Housing Market Index. Estimate 67. Actual 60
- 10:45 US FOMC Member Williams Speaks
Tuesday (November 20)
- 5:00 British Inflation Report Hearings
- 6:00 British CBI Industrial Order Expectations. Estimate -6
- 8:30 US Building Permits. Estimate 1.26M
- 8:30 US Housing Starts. Estimate 1.23M
*All release times are DST
*Key events are in bold
GBP/USD for Monday, November 19, 2018
GBP/USD November 19 at 11:55 EST
Open: 1.2829 High: 1.2884 Low: 1.2795 Close: 1.2844
GBP/USD was flat in the Asian session. In European trade, the pair posted gains but then retracted. GBP/USD has posted slight gains in North American trade
- 1.2812 is a weak support line
- 1.2915 is the next resistance line
- Current range: 1.2812 to 1.2915
Further levels in both directions:
- Below: 1.2812, 1.2706, 1.2589 and 1.2488
- Above: 1.2915, 1.3048 and 1.3173
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