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GBP Up as Brexit Deadline is Postponed Yet Again; EU IP

Note  The table above is updated before publication with the latest consensus forecasts. However, the text charts are prepared ahead of time. Therefore there can be discrepancies between the forecasts given in the table above and in the text charts. 

Rates as of 0500 GMT

Market Recap

Currencies arent much changed from Friday morning, but with regards to GBP at least this masks a large roundtrip. GBPUSD fell to 1.3135 during early US trading on Friday before recovering to end the week at around 1.3220. It then opened sharply higher in Asian trading this morning and got up to 1.3384, 1.9 above the lows, before coming off again.  

Whats going on with GBP? Well, surprise surpriseit seems that Sundays deadline wasnt really the deadline at all. UK PM Boorish Johnson and EC von der Leyen spoke on Sunday in what was supposed to be the last, final, thisisit, endoftheroad talks. They reportedly had a constructive call and agreed to go the extra mile for a deal. Now the FT is reporting that they have up until Christmas to work out a deal. 

According to the BBC, heres the state of play

On fishing rights, EU whispers suggest a kickthecan, downtheroad fudged compromise might be found though not settled yet, involving considerable European concessions
The governance of the overall deal is being worked on in detail. Still to be agreed what actions could be slapped with which sanctions, and who decides
Competition regulations aka the level playing field are still a big…

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