As investors are now wondering of the possibility that the ECB or the European Central bank might not be able to tolerate a firming euro for too long, the British pound sterling recovers from low in eleven-months and edges at 92.05 pence per euro which was 0.7% higher from their last close; in addition, the pound also edged an inch against the United States dollar, as it was 0.1% higher and traded at $1.2932.
In accordance to this, Martin Arnold, FX strategist at ETF Securities said with regards to the investor’s anticipation towards the ECB that it’s the overextended nature of the long euro trade, and that investors are seeing record of positive levels on the euro against the British pound sterling. Martin Arnold also added that it is not essentially justified by the stance of the central bank, and that as they come to the next ECB meeting, they are expecting the market to see on how restrained European Central Bank is likely to be.
Meanwhile, investors are also focusing on the third round of the Brexit negotiations as it started on Monday, the British government has already arranged series of position papers that have defined compromises over some of the issues that are likely to block progress in this year’s Brexit talk, however, European Union officials claim that Britain needs to resolve its divorce bill with the bloc before a trade settlement can be talk over.