The New Zealand dollar fell against the British pound after UK and European Union officials reached a draft agreement on post-Brexit relations. 

The kiwi declined to a week-low 52.85 British pence as at 8am in Wellington from 53.28 pence yesterday. It was unchanged at 68.11 US cents with US markets closed for the Thanksgiving Day holiday. 

The pound gained 0.8 percent after the EU and UK agreed in principle on how they will approach security, trade and other issues once Britain formally leaves the regional bloc. If the declaration goes ahead as planned it will be used as the framework for a trade agreement in the 21-month transition from the UK’s March 29 exit.

Uncertainty over the Brexit deal has weighed on the pound in recent months as investors questioned whether Prime Minister Theresa May would be able to corral enough support to push through the deal. That saw the kiwi jump 9.7 percent against the pound between Oct. 10 and Nov. 16, although it’s since given up some of those gains. 

“The UK and EU have reportedly reached agreement on some key post-Brexit details, which boosted the GBP,” ANZ Bank New Zealand economists Miles Workman and Philip Borkin said in a note. “However, domestic sticking points clearly remain so it would be a brave person to say that a key corner has been turned yet.”

The US Thanksgiving Day holiday left markets relatively quiet overnight after the Apec leaders meeting over the weekend stoked fears that the trade dispute between the US and China will slow global growth. The Organization for Economic Cooperation and Development downgraded its global growth forecasts, while the World Trade Organization’s 20th monitoring report on trade measures showed an estimated US$481 billion of trade was captured by new measures imposed by G20 economies between mid-May and mid-October. That was six times bigger than the previous reporting period and the most since it was first calculated in 2012. 

No local data is scheduled for release today. 

The kiwi increased to 4.7209 Chinese yuan from 4.7182 yuan yesterday and was almost unchanged at 76.95 yen from 76.93 yen. It traded at 93.89 Australian cents from 93.92 cents yesterday and was little changed at 59.70 euro cents from 59.76 cents. The trade-weighted index was at 74.30 from 74.34 yesterday. 

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