Theresa May spoke on Friday and claimed that Britain will become a 'champion of free trade' after Brexit, though the market reaction to this was fairly muted. The table below shows the difference in a number of currencies you could have achieved when buying £200,000.00 during the high and low points of the past month.

Currency Pair% ChangeDifference on £200,000
GBPEUR2.5%€5,250 EUR
GBPUSD2.65%$10,900 USD
GBPCHF2.65%10,950 CHF

Sterling driven by speeches

On Friday we had a number of key speeches from market moving individuals; Marc Carney, the head of the Bank of England (BOE), spoke in the morning and Theresa May, the PM spoke in the afternoon.

PM Speech drives market

Theresa May’s ‘Road to Brexit’ speech was rather insightful as she tried to set out hopes of an "ambitious economic partnership" with the EU. The PM claimed Britain will become ‘a champion of free trade’ after Brexit.

Mrs May acknowledged that access to each other’s markets will be reduced after UK withdrawal, but also restated her phrase that no deal was better than a bad deal.

The result on the markets at the time was fairly muted, however we did see the markets drop on Friday morning as the general tone of the speech was leaked to the market.

Pound’s recent surge against the Euro, US Dollar and Canadian Dollar

Failing High Street puts Sterling at risk

There have been mixed reports from the UK over the last month; UK productivity released recently showed that it grew at the fastest pace since before the financial crisis in the second half of 2017, and UK Government borrowing for the fiscal year to date is at its lowest level since the financial crisis. In contrast however UK unemployment unexpectedly rose in the final quarter of 2017 and that is a trend I expect to continue. There has been a lot of media attention on the High Street recently with confirmation that Toys’R’U’s have gone into administration putting 4,000 jobs at risk. Jamie Oliver’s restaurants and Prezzo have also announced closures with clothes retailer New Look also putting out profit warnings.  This is a story that clients with GBP exposure may wish to keep a close eye on as future Retail figures and indeed Unemployment figures may well spike following these potential mass job losses.

A further drop in activity on the high streets due to the recent weather conditions and the ‘Beast from the East’.

UK PMI to drive GBP value today

There is little significant data due from the UK this week. Today we have PMI data released at 9:30 which is expected to show a slight improvement so rates may climb on the news, however I expect today’s market to be driven by news elsewhere. GBPEUR rates will be driven by the fall-out of the Italian election overnight and GBPUSD by comment with regards to the introduction of tariffs i.e. import tax on foreign imports.  For live information please make sure to contact your personal broker.

For more information on how future data releases could affect your currency requirement, call our trading floor on 01494 725 353 or email me here.

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Exchange rates on this page are interbank rates and indicate where the market is trading to show the performance of a currency pair. They are not indicative of the rates which we offer. The information on this web site is provided free of charge for information purposes only. It does not constitute advice to any person on any matter. Foreign Currency Direct plc. ("FCD") makes every reasonable effort to ensure that this information is accurate and complete but assumes no responsibility for and gives no warranty with regard to the same.