Sterling Pound Falls on Brexit Jitters, Later Rallies on Reassurances

The  sterling pound today alternated between losses and  gains against the  US dollar driven mostly by  market sentiment given the  empty UK dockets. The  GBP/USD currency pair later rallied after the  British government confirmed that it was committed to  sealing a  post-Brexit trade deal with the  EU.
The  GBP/USD currency pair today fell to  a  low of  1.2644 before recouping all its losses to  trade slightly above its opening price at  1.744 and  was near these highs at  the  time of  writing.
The  currency pair headed lower earlier today on  reports that the  British government was planning to  trade with the  EU on  World Trade Organization (WTO) rules. The news triggered the  selling given that it came just a  few days before Boris Johnson’s hard deadline on  the  delivery of  a  skeleton trade agreement. However, a  spokesman for  the  Prime Minister later said that the  government was committed to  signing a  trade deal with the  European Union before the  December deadline. The  news triggered a  comeback rally from the  pound even as  the  greenback weakened as  tracked by  the  US Dollar Index, which hit a  low of  94.83.
The  greenback’s weakness boosted the  cable’s recovery as  US lawmakers debate a  new stimulus program. The  rising US coronavirus cases also contributed to  the  dollar’s overall weakness as  investors worry about a  second lockdown derailing the  US economic recovery.
The  currency pair future performance is likely to  be affected by  tomorrow’s CBI data and  geopolitical events.
The  GBP/USD currency pair was trading at  1.2738 as  at  19:08 GMT, having recovered from a  low of  1.2644. The  GBP/JPY currency pair was trading at  136.58, having rallied from a  low of  135.29.
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