GBP/USD drops sharply to 1.3080 as no-deal Brexit fears return

• Increased odds of no-deal Brexit, USD rebound knocks-off GBP/USD.
• All eyes remain on Brexit headlines, US macro data and EU Summit.

The GBP/USD pair stalled its steady recovery mode near 1.3160 and ran into heavy offers after the greenback staged a solid rebound across the board, mainly driven by an 80-pips sell-off in the EUR/USD pair following awful Eurozone and German manufacturing March PMI reports.

Goldman Sachs raises chances of no-deal Brexit, says all options in play

The latest slide in the spot can be also attributed to the return of the GBP bears, as markets are now pricing in the chances of a no-deal Brexit again, as they believe the 2-weeks Brexit deadline extension granted by the European Union (EU) to the UK PM May is unlikely to resolve any problem for May’s government.

Meanwhile, no new surprises offered by the Bank of England (BOE) a day before also continues to weigh down on the investors’ minds, as attention gradually shifting towards a fresh batch of macro releases from the US docket due later today. Markets look forward to the manufacturing and services PMI reports from Markit and existing homes sales data for fresh trading incentives while the Brexit-related anxiety will continue to play out ahead of the EU Summit next week.

GBP/USD Technical Levels