Selling Britain by the pound
Summary: Forex traders are no more impressed by UK PM Theresa May’s latest efforts than were the leaders of the European Union, and sterling is on track to take the ‘week’s worst performer’ title away from a languishing loonie.
FX traders see the UK as chopped liver and are selling it by the pound. At one point this week, GBPUSD was down 2.3% from peak to trough as the UK’s Brexit plan took a turn for the worse. The European Union’s decision to deny Prime Minister Theresa May’s request for a three-month extension to Article 50 in favour of a May 22 end date precipitated the plunge. Even after the Queen’s currency climbed from the low to 1.3195 today, it is still on track to finish the week as the worst-performing currency.
The Canadian dollar takes the silver medal. It lost 0.52% (as of 13:30 GMT) since last Friday’s close and turned the short-term technical outlook to bullish. January Retail Sales fell 0.3%, a nasty surprise for those expecting a 0.4% increase. Statistics Canada blamed the drop on lower sales of motor vehicles and parts. USDCAD jumped to 1.3425 from 1.3395 on the news but quickly retreated, in part because of slightly better than expected inflation data. February CPI rose 1.5%, year-on-year, and rose 2.1% excluding gasoline prices.