The GBPUSD jumped 2.3% by 11:15 PM ET (03:15 GMT). GBPUSD rallied to a clear majority for the Conservatives. Here is the GBPUSD Fundamental Analysis of 13 December, 2019.
13 December, 2019 | AtoZ Markets – The GBPUSD pair now appears to have entered a bullish consolidation phase. And it has been seen oscillating within a narrow trading margin, just above the middle of the 1.3400s range.
GBPUSD Fundamental Analysis – 13 December 2019
After the rather volatile fluctuations of the previous session, the pair recorded aggressive offers early in the Asian session on Friday. And it reached its highest level since May 2018 – levels beyond the key psychological mark of 1.3500.
The pound sterling soared in all areas in reaction to the expected results of the British elections. That indicated a crushing victory for the Conservative Party of outgoing Prime Minister Boris Johnson.
With more than 500 constituencies declared, the Conservatives were seen as the clear and substantial winners in the most important British general election. That is according to the latest updated forecasts from Sky News. Market participants said a decisive Tory victory would pave the way for Britain’s exit from the EU on 31 January, dispelling Brexit’s uncertainties, which will ultimately be good for the economy.
Given that the market could have been optimistic about the Conservatives’ win. And the recent rally of more than 1,500 pips since the beginning of September drove prices down. Bulls now seem reluctant to place new ones amid extremely overbought conditions. The British pound jumped more than 2% against the US dollar after a poll in the UK suggested that Boris Johnson’s Conservative Party may win the election.
Brexit Divorce Agreement
If the Conservatives win a majority, the adoption of a Brexit divorce agreement in the coming weeks will eliminate any risk of a no-deal Brexit on 31 January. It reduces immediate uncertainty and at least increase business investment, at least. Paul Dales, chief economist in the UK’s Capital Economics, said that in a CNBC report. The official results will be communicated later in the day.
US President Donald Trump has approved a phase-one trade deal with China. The signing of the agreement avoids the planned introduction of new tariffs on Chinese products.
In return, Beijing will buy more agricultural products as part of the trade deal, according to Bloomberg. People who know the issue well quoted that. Some existing tariffs on Chinese products could also be reduced, according to the report. The onshore rate rose 1% per dollar following the news, the strongest since 2 August on an intraday basis.
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