ANL 20.85 Decreased By ▼ -1.48 (-6.63%)
ASC 13.54 Decreased By ▼ -1.06 (-7.26%)
ASL 23.00 Decreased By ▼ -0.65 (-2.75%)
BOP 8.20 Decreased By ▼ -0.08 (-0.97%)
BYCO 7.81 Decreased By ▼ -0.34 (-4.17%)
FCCL 17.80 Decreased By ▼ -0.17 (-0.95%)
FFBL 22.75 Decreased By ▼ -0.73 (-3.11%)
FFL 15.50 Decreased By ▼ -0.60 (-3.73%)
FNEL 7.35 Decreased By ▼ -0.62 (-7.78%)
GGGL 17.83 Decreased By ▼ -1.57 (-8.09%)
GGL 40.01 Decreased By ▼ -1.73 (-4.14%)
HUMNL 6.02 Decreased By ▼ -0.32 (-5.05%)
JSCL 18.30 Decreased By ▼ -1.07 (-5.52%)
KAPCO 36.35 Decreased By ▼ -0.83 (-2.23%)
KEL 3.40 Decreased By ▼ -0.08 (-2.3%)
MDTL 2.65 Decreased By ▼ -0.05 (-1.85%)
MLCF 35.10 Increased By ▲ 0.11 (0.31%)
NETSOL 129.40 Decreased By ▼ -9.90 (-7.11%)
PACE 4.75 Decreased By ▼ -0.37 (-7.23%)
PAEL 27.00 Decreased By ▼ -1.35 (-4.76%)
PIBTL 8.85 Decreased By ▼ -0.05 (-0.56%)
POWER 7.45 Increased By ▲ 0.15 (2.05%)
PRL 17.15 Decreased By ▼ -1.15 (-6.28%)
PTC 10.01 Increased By ▲ 0.01 (0.1%)
SILK 1.50 Decreased By ▼ -0.01 (-0.66%)
SNGP 45.00 Decreased By ▼ -0.30 (-0.66%)
TELE 18.89 Decreased By ▼ -1.52 (-7.45%)
TRG 162.70 Decreased By ▼ -6.80 (-4.01%)
UNITY 32.95 Decreased By ▼ -0.10 (-0.3%)
WTL 2.94 Decreased By ▼ -0.02 (-0.68%)
BR100 4,733 Decreased By ▼ -88.48 (-1.84%)
BR30 22,802 Decreased By ▼ -674.49 (-2.87%)
KSE100 45,297 Decreased By ▼ -300.36 (-0.66%)
KSE30 17,811 Decreased By ▼ -218.45 (-1.21%)

Coronavirus
VERY HIGH Source: covid.gov.pk
Pakistan Deaths
27,432
5824hr
Pakistan Cases
1,232,595
2,35724hr
4.9% positivity
Sindh
453,051
Punjab
425,703
Balochistan
32,812
Islamabad
104,619
KPK
172,210

LONDON: The pound surged to a five-week high on Thursday after lawmakers voted to prevent Prime Minister Boris Johnson taking Britain out of the European Union on Oct. 31 without a transition agreement and his brother Jo quit the government, citing national interest.

Political uncertainty remained high as the prime minister renewed his effort to seek an election on Oct. 15 after a first attempt was defeated on Wednesday. But sterling responded to a sense that a no-deal Brexit had been averted for now.

"Removing the immediate threat of a no-deal Brexit has helped the pound recover some of its recent weakness," said Daniel Trum and Dean Turner, strategists at UBS Wealth Management.

The British currency rose as much 0.8pc to above $1.2350, its highest since July 29 and building on Wednesday's 1.4pc surge, its biggest one-day jump since March.

Though it trimmed some gains to stand 0.6pc up on the day at $1.2325 in late London trading, the pound is firmly on track for its biggest two-day rise in 10 months as some hedge funds are forced to unwind some of their extreme bearish bets.

The pound has been shunned in recent weeks as concerns grew that Britain would crash out of the EU without a deal on the scheduled date of Oct. 31.

On Monday, it fell to below $1.20, a near-three-year low.

UBS analysts said that if Brexit were delayed until January, and an election were set for a date after Oct. 31, the pound could rise as high as $1.30, a four-month high.

"A delay for both Brexit and general election will continue to send the pound higher," said Neil Jones, head of hedge fund currency sales at Mizuho Bank.

The rally reverberated through the derivative markets as well. Two-month implied volatility gauges for pound options, which cover the scheduled Oct. 31 Brexit date, fell.

The drop in expected price swings for the pound indicated markets were unwinding extreme short-term negative bets.

Two-month implied volatility fell below 13 vol after rising to a three-year high of nearly 16 vol earlier this week.

Despite the rebound, the British currency remained more than 8pc below its March highs of nearly $1.34, with many citing the uncertainty that an election would bring, whenever it is held.

"With the results from any election so hard to forecast and the difficulty of still fixing on a deal, we think further pound rallies are likely to be limited until we have clarity on outcomes," said John Marley, a senior FX consultant at FX risk management specialist, SmartCurrencyBusiness.

Against the euro, the British currency gained 0.4pc to 89.61 pence.

Copyright Reuters, 2019

Comments

Comments are closed.