Sterling traders kept the currency afloat on Tuesday as they searched for clues on how likely it was for Britain to reach a trade deal with the European Union by the end of the year.
Price actions suggest investors lean towards a scenario where both parties eventually will agree on some sort of a deal, as they did last year over the divorce agreement.
Sterling was last trading flat both against the U.S. dollar at $1.2944 and against the euro at 90.98 pence.
So far this month, Brexit-induced volatility has left minimal mark on the price of the pound, which on a month-to-date basis, remains little changed.
However, traders were bracing for volatility as they bought more protection in the options market. Options costs highlighted that implied volatility rose to nearly 12%, a more than two-month high.
On Monday, Britain said it saw no basis to resume trade talks with the EU unless there is a fundamental change in approach from Brussels.
Talks halted last week as Prime Minister Boris Johnson said there was no point in continuing them, cancelling an in-person meeting. Discussions still were held over the phone, but negotiations have not resumed yet officially.
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04 Dec 2020 03:57 PM
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04 Dec 2020 11:35 AM
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04 Dec 2020 11:01 AM
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04 Dec 2020 10:44 AM
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