Tuesday saw the crescendo of the Conservative Party Conference as Prime Minister, Boris Johnson, made his keynote speech. Johnson gave rough details of the ‘final’ Brexit deal, this saw the pound have a slight rebound from earlier in the day when traders were awaiting information around the deal that has been billed as his final offer.
However, there was no more than a slight rebound as the speech offered little clarity on what exactly Britain would propose to the EU at the summit that will be held in Brussels on the 17th. Johnson did strike a hopeful tone and this trickled into the market as traders covered previous short bets.
This lack of clarity has only seen greater expectations for price swings on the pound and implied volatility for one-month maturities, which has nearly doubled over the last three weeks as heightened volatility is expected between now and the 31st deadline.
15:00 – USD: ISM Non-Manufacturing PMI (Sep); expected to fall to 55.1 from previous 56.4.