Pound Lower as Brexit Deal Facing Obstacles in Parliament

The GBP/USD fell 0.55 percent on Friday. The currency pair is trading at 1.2804 against the US dollar as the Brexit deal is facing pressure from both sides. British PM Theresa May still has to push through the agreement in parliament, with shrinking possibilities of success. On the other hand Spanish negotiators left the Gibraltar issue until last minute and is another obstacle that could derail a deal being reached between the EU and the UK.

European Leaders remain optimistic about reaching an agreement over the weekend, but things look harder in the UK parliament. The March 29 deadline approaches, and if an agreement is not reached the no-deal exit will be a reality. Theresa May is saying that holding out for a better deal is not ideal, as she continues to endorse the current deal on the table.

Brexit headlines will guide the pair as investors try to quantify the most likely outcome and its impact on the final exit from the European Union. If a deal is rejected by UK parliament at this stage, it won’t be the end but it will mean an amendment if possible would have to be presented in February.

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Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza