FUNDAMENTALS:
Pound extended its decline to a 3 month low on escalating trade tensions between US and China and fading optimism that Brexit can be resolved. Sterling is the worst performer among its peers this week as the market is unconvinced that the UK Parliament can get her Brexit deal through the Parliament on the fourth try next month. With the opposition Labour saying that they would not support the bill in the current form, which Theresa May aims to pass it through the Parliament by June 3, it suggests a higher risks of a hard Brexit in November if Theresa May steps down, raising concerns about the prospect of an economically damaging deal. Options traders have increased bearish bets on the currency this week while asset managers remain short and leveraged funds cut their net long position to the lowest since March, according to latest data from the Commodity Futures Trading Commission.
