Sterling Retains A Buoyant Tone on Brexit Hopes

Cable picked up demand Wednesday on the back of optimistic hopes in current Brexit negotiations along with comments from BOE Haldane suggesting that current conditions do not warrant negative rates. General risk on tone also acted to counter the expected month-end USD demand, aided by the strong opening in US equities, cable trading up to a high of $1.2942 through the 1600BST fix before it fell back to $1.2896 in post fix business but closed the day at $1.2923. Holiday thinned trade in Asia began sedately with early trade contained within $1.2814/28 before a strong spike higher in CNH provided another risk on react, taking cable up to $1.2950 into Europe. Rate holds most of these gains at writing. A clear above $1.2950 to expose $1.2967(Sep21 high) ahead of $1.2984(38.2% $1.3482-1.2676). Support $1.2915/00. Final UK Mfg PMI released at 0930BST provides domestic data interest. BOE Haldane speaks at 1120BST. US Jobless Claims and ISM provide main afternoon focus. Brexit, COVID remains potential market movers.