Pound falls as Brexit risks blow up again
- No-deal Brexit risks resurface after reports in the U.K. said Boris Johnson would change the law to ensure the transitional phase ends as scheduled on Dec.31.
- Short transition phase leaves little time to reach a trade deal with the European Union.
- Economic data on Japan caused the USD/JPY to change little at 109.43 against the USD.
On Wednesday, the GBP fell in Asis as Brexit risks resurface.
The GBP/USD pair dropped 0.2% to 1.3098 after falling more than1% in the previous session.
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No-deal Brexit risks resurface after reports in the U.K. said Boris Johnson would change the law to ensure the transitional phase ends as scheduled on Dec.31.
It leaves little time to reach a trade deal with the European Union.
Economic data released showed Japan’s export fell 7.9% in November from a year earlier. It was in its 12th straight month of decline. Imports also fell by 15.7%.
The data caused the USD/JPY to change little at 109.43 against the USD.
The U.S. Dollar index inched up 0.1% to 96.873. The Dallas Fed President Robert Kaplan reiterated that interest rates would remain on hold unless the U.S. economic outlook changes considerably.
“I’ve already got baked into my outlook, we’re going to have weak manufacturing next year, sluggish global growth, pretty sluggish business investment, but with a strong consumer,” said Kaplan in a Bloomberg Television interview.
“I’d been worried that weak business investment and weak manufacturing would seep into other parts of the economy. We haven’t seen that yet,” he said.
“We’ve got a very tight jobs market, and there’s no evidence I see that the jobs market is doing anything but getting tighter. That’s a pretty good tailwind for the consumer,” he said.
“So, unless something changes, that causes the employment picture to change, the consumer is going to be solid for next year.”
Meanwhile, the AUD/USD pair slipped 0.1% to 0.6844.