30 August 2018 : Sterling traders were caught by surprise on Wednesday after the EU’s Chief Brexit negotiator Michel Barnier said, “We are prepared to offer a partnership with Britain such as has never been with any other third country.” His statement comes after the risk of a hard Brexit, or no-deal Brexit grew significantly over the past few weeks. The Pound rallied sharply on the news, gaining 149 pips against the dollar. 

Many investors would be wondering whether Barnier’s statement could be a turning point for the Pound. Although many issues related to trade and the Irish border are far from being resolved, it currently seems that negotiations may begin moving in the right direction. If positive news flows continue when Brexit Secretary Dominic Raab heads back to Brussels on Friday to resume talks, GBPUSD may quickly return to July highs that were above 1.33. However, expect volatility to surge in the coming weeks as we get closer to the Brexit deadline.

Source: Hussein Sayed, Chief Market Strategist at FXTM

Reporting for EasyKobo on Thursday ,30 August 2018 in Lagos, Nigeria