24.10.2021

Learn Fortitude from the Pound, Anna Bodrova, Senior Analyst at Alpari

On Friday morning, the pound / dollar pair is trading at 1.3276. Thus, the “Briton” returned to the marks of the beginning of the month, and for this he has reasons.

In recent weeks, negotiations are underway on the Brexit process, whose topics are not very interesting to the layman – communication between politicians concerns the nuances of the formation of the legislative system and certain aspects of foreign policy after the UK left the European Union. The market reacts to high-profile moments: for example, the failed speech of Theresa May earlier, or press reports about the benefits for Foggy Albion.

It is worth dwelling here in a little more detail, because the information of the Handelsblatt publication may become an occasion for discussion within the framework of Brexit today. We are talking about the possible granting of a certain transitional period to Great Britain, two years long, so as not to speed up the negotiation process and smoothly leave the EU.

There is a price to pay for gradualism: as a condition, the EU may require London to repay all financial obligations.

Given that Britain was initially willing to pay for its autonomy, it can be assumed that politicians will seize the chance if they are indeed given this option. The pound sterling will strengthen under similar conditions. The first bullish target will be 1.3300, followed by 1.3345. However, closer to the end of Friday’s session, investors may partially fix profits in order to return to the rise in the instrument next week.

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