The USD GBP tading pair ended in positive territories in yesterday’s sessions as traders worry about the pound’s vulnerability. Yesterday, Britain released its revamped temporary tariffs regime if a no-deal Brexit pushes through.
The news caused the USD GBP exchange rate to rally and the British pound and its futures to contract yesterday.
The USD GBP pair went up by 0.74% or 0.0060 points yesterday. The USD GBP exchange rate reached levels between £0.8128 and £0.8197 during Tuesday’s trading.
Aside from its losses against the greenback, the pound also lost to the euro, Japanese yen, and Swiss franc.
The British pound contract fell by 0.76% or 0.0094 points yesterday. Meanwhile, the EUR GBP trading pair went up by 0.73% or 0.0065 points, reaching levels between £0.8922 and £0.9002.
The GBP JPY pair, on the other hand, lost 1.07% or 1.41 points in Tuesday’s sessions. The pair extended its losses from ¥132.12 to ¥130.44 yesterday.
And the GBP CHF trading pair declined 1.03% or 0.0126 points, reaching ranges from Fr1.2094 to Fr1.2244 yesterday.
The USD GBP trading pair continues to strengthen as traders get more concerned about the Brexit. Yesterday, the United Kingdom published a new temporary sanction system that will take effect in case of a no-deal Brexit.
According to reports, the new arrangement will affect almost 88% of total imports by value. The new regime will also allow the products tariff-free access.
The new plan will last for 12 months, and it aims to keep prices low at the same time support domestic producers. The system will lower the tariffs on trucks and add more levies on bioethanol and other clothing products.
The first tariffs regime of the UK was released in March and served for the original Brexit date. However, some traders are hoping that Johnson delivers a Brexit plan and that the new regime will not push through.