GBP Plummets As Theresa May Suffers Another Blow

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1. GBP Plummets As Theresa May Suffers Another Blow

In the UK, Theresa May was dealt a significant blow on Wednesday night when one of her top cabinet ministers – Andrea Leadsom, the Leader of the House of Commons and a prominent Brexiteer – resigned over the British Prime Minister’s approach to Brexit. Leadsom stated that she “fundamentally opposes” May’s latest Brexit bill and thus she is forced to resign. GBP/USD is still weak amid the political turmoil around Brexit, the sterling was last seen trading 0.4% lower against the dollar at 8:25 GMT.*


2. Global Markets Plummet

Markets in Asia noted a bearish close, while European markets having started the day lower on Thursday amid ongoing U.S.-China trade concerns. Market participants will focus on geopolitical developments today and specifically any news on the US/China trade standoff and the Brexit front. Investors will look to PMI data out of Europe later in the day for direction, a positive reading might lead to a rebound in sentiment, which is currently very negative.**  


3. Strong Dollar Overwhelms the Markets

Simmering Sino-U.S. trade tensions continued to provide support for the greenback, while yesterday’s minutes of the U.S. Federal Reserve meeting indicated that there was no hurry in cutting rates, which also left the dollar invulnerable. DXY was last seen 0.2% higher as of 8:25 GMT. Elsewhere, the AUD and NZD are still quite weak due to the US/China trade war while the safehaven yen advanced against its peers on Thursday as persistent U.S.-China trade fears and Brexit concerns sparked risk aversion, and lifted safe-havens.***


4. Oil Prices Plummet, Gold Remains Subdued

Oil prices dropped on Thursday, extending losses incurred during the previous session amid surging U.S. crude inventories and weak demand from refineries. Brent crude futures were last at $70.36 per barrel at 8:25 GMT, down 65 cents; while U.S. West Texas Intermediate (WTI) crude futures were down by 63 cents, or 0.9 percent, at $60.96 per barrel. Elsewhere, spot gold remain subdued as a stronger USD reduced the appeal of the dollar denominated noble metal.****


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*CNBC May 23, 2019 2:48 AM ET
**Reuters May 23, 2019 3:53 AM ET
***FXStreet May 23, 2019 03:07 AM ET
***Bloomberg May 23, 2019 06:13 AM ET

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