The pound edged up against the dollar and euro in early London trading on Wednesday, shrugging off postBrexit trade issues over Northern Ireland, while market participants looked ahead to the European Central Bank meeting and U.S. CPI data on Thursday.
Currency markets have been generally sluggish so far this week ahead of the two events on Thursday which are expected to be marketmoving.
At 0757 GMT, sterling was up 0.1 versus the dollar, at 1.4169, having traded in a tight range since midMay.
Versus the euro, it was up 0.1 at 85.97 pence per euro .
Sterlingdollar implied volatility gauges with onemonth maturities were at their lowest since February 2020, suggesting that market participants are not bracing for significant priceaction.
Limited data points today and the market being fully focused on the ECB and US May CPI tomorrow suggest subdued price action in both EURGBP and GBPUSD today, wrote ING strategists in a note to clients.
Britains Brexit minister, David Frost, is meeting European Commission Vice President Maros Sefcovic in London on Wednesday to try to resolve the differences over trading arrangements in Northern Ireland.
Brussels accuses London of breaking the agreement by failing to implement checks on some goods moving from Britain to its province of Northern Ireland, and has started legal action over the British governments unilateral extension of a grace period.
So far, months of talks have done little to break the deadlock, and Britain said on…