GBP/USD has posted slight gains on Thursday, continuing the upward trend we’ve seen for most of this week. In the North American session, the pair is trading just below the 1.29 line. Earlier, the pound touched a high of 1.2917, its highest level since early October. The pound received a boost from CBI Realized Sales, which climbed to 38 points, crushing the estimate of 6 points. In the US, key indicators were dismal. Core Durable Goods, Unemployment Claims, and Pending Home Sales all missed their estimates. On Friday, the UK releases Preliminary GDP, with an estimate of 0.4%. The US will publish Advance GDP, which is expected to gain 1.3%. We’ll also get a look at UoM Consumer Sentiment.

In the UK, there was good news on the consumer front, as retailers reported a sharp increase in sales volume. With Brexit constantly in the minds of the markets, consumer spending indicators are being closely monitored. The British economy has performed better than many analysts (and the BoE) expected, but the markets are understandably nervous about the impact that Brexit will have on the economy, given the fact that the EU is Britain’s largest trading partner. On Friday, the economy will get a report card in the form of Preliminary GDP, and traders should treat this event as a market-mover.

Talks over Britain’s departure from the EU are expected to be lengthy and difficult, and EU leaders don’t appear to be in a generous mood, as they met in Brussels this week to discuss a united front in the Brexit talks. Britain wants any deal to include financial services, but the Europeans are working on a draft that would exclude the financial sector unless it is governed by EU rules. There are also likely to be sharp disagreements over the size of Britain’s debt to the EU, among other major issues. For now, the British government is concentrating on the June election, but after that things could get nasty between the sides. If the Brexit talks run into trouble, market sentiment could take a dive and that could spell trouble for the British pound.

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One of President Trump’s most important campaign platforms was overhauling the US tax code. Trump finally announced his long-awaited tax plan on Wednesday. The proposal calls for sharp reductions for both individuals and corporations. The plan calls for three tax brackets for individuals – 10%, 25% and 35%. The corporate sector would also see significant tax relief, with the corporate tax rate dropping from 35% to 15%, and the tax on multinationals’ overseas profits lowered from 35% to 10%. However, any tax reform proposals from the White House will require a stamp of approval from Congress, so Trump’s proposal should be viewed as a blueprint that is a long way off from becoming law. Trump’s proposal was short on details, although government officials are praising it as one of the largest tax cuts and broadest overhauls of the tax system in history. There hasn’t been much reaction from the currency markets, with the dollar showing limited movement against the pound and other major currencies in Thursday trading.

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