Asia Morning: British Pound Sinks as No-Deal Brexit Fears Return

On Monday, GBP/USD plunged 1.0% to 1.3166, European Commission President Ursula von der Leyen warned the U.K. that...

Trading floor 3

On Monday, U.S. stock markets were closed to observe the Labor Day.

Later today, the National Federation of Independent Business will post its Small Business Optimism Index for August (99.0 expected).

European stocks were broadly higher. The Stoxx Europe 600 Index rose 1.6%, Germany's DAX 30 surged 2.0%, France's CAC 40 climbed 1.8% and U.K.'s FTSE 100 jumped 2.4%.

WTI crude oil futures (October) slid 1.4% to $39.21 a barrel. Government data showed that China's crude imports dropped to 47.48 million tons in August from 51.29 million tons in July, down for a second straight month.

Spot gold was flat at $1,933 an ounce.

On the forex front, the ICE U.S. Dollar Index gained 0.2% on day to 93.06 in thin holiday trading.

EUR/USD fell 0.2% to 1.1818. Official data showed that German industrial production grew 1.2% on month in July (+4.5% expected).

GBP/USD plunged 1.0% to 1.3166. European Commission President Ursula von der Leyen warned the U.K. that implementing the Withdrawal Agreement was "an obligation under international law and a prerequisite for any future partnership". Her comments came after British Prime Minister Boris Johnson said the country is ready to walk away if no agreement is struck by October 15.

GBP/USD daily chart:

Source: Gain Capital, TradingView

USD/JPY edged up 0.1% to 106.30. Government data showed that Japan's final readings of 2Q annualized GDP was confirmed at -28.1% on quarter (-28.5% expected), while household spending declined 7.6% on year in July (-3.7% expected).

Commodity-linked currencies were mixed against the greenback, AUD/USD was little changed at 0.7282, NZD/USD dropped 0.4% to 0.6696, while USD/CAD rose 0.2% to 1.3091. Official data showed that China's exports rose 9.5% on year in August (+7.5% expected) while imports fell 2.1% (+0.2% expected).

More from Forex

Disclaimer

This report is intended for general circulation only. It should not be construed as a recommendation, or an offer (or solicitation of an offer) to buy or sell any financial products. The information provided does not take into account your specific investment objectives, financial situation or particular needs. Before you act on any recommendation that may be contained in this report, independent advice ought to be sought from a financial adviser regarding the suitability of the investment product, taking into account your specific investment objectives, financial situation or particular needs.

GAIN Capital Singapore Pte. Ltd., may distribute reports produced by its respective foreign entities or affiliates within the GAIN Capital group of companies or third parties pursuant to an arrangement under Regulation 32C of the Financial Advisers Regulations. Where the report is distributed to a person in Singapore who is not an accredited investor, expert investor or an institutional investor (as defined in the Securities Futures Act), GAIN Capital Singapore Pte. Ltd. accepts legal responsibility to such persons for the contents of the report only to the extent required by law. Singapore recipients should contact GAIN Capital Singapore Pte. Ltd. at 6826 9988 for matters arising from, or in connection with the report.

In the case of all other recipients of this report, to the extent permitted by applicable laws and regulations neither GAIN Capital Singapore Pte. Ltd. nor its associated companies will be responsible or liable for any loss or damage incurred arising out of, or in connection with, any use of the information contained in this report and all such liability is hereby expressly disclaimed. No representation or warranty is made, express or implied, that the content of this report is complete or accurate.

GAIN Capital Singapore Pte. Ltd. is not under any obligation to update this report.

Trading CFDs and FX on margin carries a high level of risk that may not be suitable for some investors. Consider your investment objectives, level of experience, financial resources, risk appetite and other relevant circumstances carefully. The possibility exists that you could lose some or all of your investments, including your initial deposits. If in doubt, please seek independent expert advice. Visit cityindex.com.sg for the complete Risk Disclosure Statement.

Important Notice:

Cryptocurrencies are not legal tender currency and trading of derivatives on Cryptocurrencies are currently not covered under any regulatory regime in Singapore. Consequently, investors should be aware they do not have protection under the Securities and Futures Act (Cap. 289). Please ensure that you are fully aware of the risks.