2019.08.2210:48:00UTC+00Pound Strengthens On Merkel's Comments On Brexit Deal

The pound strengthened against its major counterparts in the New York session on Thursday, after German Chancellor Angela Merkel remarked that she has not set a 30-day deadline for the U.K. to find a solution to the Irish "backstop."

Merkel clarified that yesterday's comments were meant to hint that what can be achieved in three or two years can also be found in 30 days.

"Better said, one must say that one can also achieve it by October 31," she said at a speech in the Hague.

On Wednesday, Merkel suggested British Prime Minister Boris Johnson to come up with alternative plans for the Irish border within 30 days. Her comments were misinterpreted as a deadline to Johnson to find a solution to the Irish border issue.

The Distributive Trades Survey from the Confederation of British Industry showed that British retailers reported the sharpest decline in sales volumes and orders since 2008.

About 10 percent of respondents reported that sales volumes were up on a year ago in August, while 58 percent said they were down, giving a balance of -49 percent. A net 10 percent expects sales volumes to fall at a slower pace next month.

The pound advanced to more than 3-week highs of 0.9028 against the euro and 1.2273 against the greenback, from its early low of 0.9158 and a 2-day low of 1.2108, respectively. The next possible resistance for the pound is seen around 0.87 against the euro and 1.27 against the greenback.

The pound climbed to 3-week highs of 1.2065 against the franc and 130.70 against the yen, from its early low of 1.1886 and a 2-day low of 128.76, respectively. If the pound rises further, 1.26 and 136.5 are likely seen as its next resistance levels against the franc and the yen, respectively.