Which currencies are likely to gain in the event of a no deal Brexit?

[John Naronha]

[Ignatius Bose]

Even as UK Prime Minister, Theresa May is making a final push to save the Brexit deal, the forex markets are witnessing massive volatility, seesawing between gains and losses. The Sterling and the Euro rose earlier today as Ms May secured a last minute legally binding instrument from the EU for the Irish backstop, a key requirement by DUP MP’s. But the gains were eventually lost during the day as legal experts in UK maintained that the risk still remains and could keep UK tied into the backstop indefinitely.

During events like these, traders generally switch to buying safe haven currencies like the Swiss franc, US dollar, Japanese yen and also Gold. At 6.00 PM GMT, the EURCHF pair was seen trading at 1.1375, up 0.0012 pips while the GBPCHF was at 1.3158, down 0.0132 pips for the session correspondingly. Spot Gold which ended Monday’s session at $1293.30 per ounce and was down for most part of Tuesday’s morning session reversed losses and was last seen at $1298.50, up $5 for the day.

Illustrated below is the hourly chart for Spot Gold

[Ignatius Bose]

Even as UK Prime Minister, Theresa May is making a final push to save the Brexit deal, the forex markets are witnessing massive volatility, seesawing between gains and losses. The Sterling and the Euro rose earlier today as Ms May secured a last minute legally binding instrument from the EU for the Irish backstop, a key requirement by DUP MP’s. But the gains were eventually lost during the day as legal experts in UK maintained that the risk still remains and could keep UK tied into the backstop indefinitely.

During events like these, traders generally switch to buying safe haven currencies like the Swiss franc, US dollar, Japanese yen and also Gold. At 6.00 PM GMT, the EURCHF pair was seen trading at 1.1375, up 0.0012 pips while the GBPCHF was at 1.3158, down 0.0132 pips for the session correspondingly. Spot Gold which ended Monday’s session at $1293.30 per ounce and was down for most part of Tuesday’s morning session reversed losses and was last seen at $1298.50, up $5 for the day.

 

                                     Illustrated below the hourly chart for Spot Gold