NZD GETS A BOOST | THE IRISH BORDER TALKS ARE HEATING UP

The Irish border is still a hot topic, as Brexit talks continue. The New Zealand dollar gets a boost from the country’s CPI numbers release.

The EU and the UK negotiators met in an unscheduled meeting on Sunday to discuss the Irish border issue. There are less than six months left until the official “divorce” date and there is still no clear guidance on how the two sides will proceed with the Irish border. Mrs May said that the EU wants to keep Northern Ireland in the EU customs union if the UK plan is not achieved in time when the transitional arrangement ends in 2020. This is because the EU is afraid that if Britain leaves the bloc without an agreement, this could disrupt trade between them and the EU, which could have negative effects that are too difficult to predict. Mrs May has told that Northern Ireland could not be treated differently, as it is part of the UK and such measures could divide the country.

GBP/CAD — Technical Outlook

GBP/CAD had broken its short-term upside support line taken from the low of the 4thof October but has now started moving sideways. Given that there is still uncertainty around Brexit and the Canadian dollar continues to show more strength, we could see GBP/CAD sliding further down to test the levels where it was in the beginning of the month.

NZD/USD — Technical Outlook

As we mentioned already above in our analysis, the New Zealand dollar had a boost from the country’s CPI numbers and now looks quite positive. From the technical side, NZD/USD could travel a bit more to the upside, as it is still above its short-term upside support line drawn from the low of the 9thof October. That said, the potential uprise could be limited, as the pair could eventually hit the medium-term downside resistance line taken from the peak of the 25thof June.

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