Boris Johnson's Brexit Blueprint is laid out in the Telegraph this morning, detailing the problems he sees with Mrs May’s Brexit, and outlining his pursuit of a ‘Super-Canada’ deal. Boris Johnson’s desire for office is no secret and this could increase tensions going into the Conservative Party conference, which begins this weekend. More on the potential impact of this uncertainty and an update to the current state of Brexit negotiations in the market report below, the table shows the difference in exchange rates for a number of currency pairings at the high and low points of the past 1 month.

Currency Pair% Change in 1 monthDifference on £200,000
GBPEUR0.55%€1220
GBPUSD0.25%$640
GBPAUD0.52%AUD $1720

Sterling rates dipped markedly in 2016 when Boris Johnson announced he would come out in favour of Leave. So, clients with a GBP position, buying or selling might wish to review their situation before the weekend to ensure they are not wrong-footed by any sudden comments or headlines.

Today is also an important day with the release of the latest Gross Domestic Product (GDP) data for the UK. Focusing on Q2, the period between April and June of this year, it is essentially old news but might still move sterling rates if the data comes in different to the expected 0.4%.

It could be a rough week for the Pound

Where next for the pound and Brexit?

The short answer to this question is no one really knows. The market has been getting mixed signals. The recent confidence over a ‘deal’ being reached as highlighted by Michel Barnier once again yesterday, is very fragile. In a sign of what to expect ahead, GBPEUR rates have moved 2.7% since the 28th August and the intensity should now begin to increase further as we approach crunch time for Brexit.

There are many different and contrasting views on what the right Brexit will or should be, and even if we should have one. As deadlines loom for a deal to be reached, the pressures will surely intensify. Neither the hardcore Brexiteers, strong Remainers, nor the EU appear willing to compromise. A key area of concern is the Irish border and little progress appears to be being made.

The Brexit saga continues to drag on and clients awaiting clarification and a sturdier pound, have a few more twists and turns in the road ahead. In fact, with the potential crunch time on exactly what Brexit means just around the corner, the recent volatility might appear very calm upon reflection.

It is also worth remembering that the UK Parliament and all the individual member states still need to agree to the final deal. This will be a major hurdle to clear and may not happen until the end of this or next year. There is still a possibility we could see the current Article 50 period extended, if all members of the EU agree that is the right thing to do. Whilst we do appear to be getting closer to understanding a deal, there are more questions than ever.

I feel sure that in the end Brexit will work itself out and sterling will regain composure but with the next 6 months offering all manner of outcomes, some careful planning and preparation for clients concerned with a sterling transfer is key.

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.