Sterling crept up slightly during trading yesterday afternoon as we saw the close of the Conservative Party Conference and also a fairly positive update from Dominic Raab.
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Theresa May seemed confident in her speech that she would not let the U.K down however the negotiations panned out, and she reiterated that a no deal Brexit would not only be bad for the U.K but equally bad for the EU too, so both sides are keen to put something together.
I feel that the mere fact that we have seen no major dramas during the conference is also a big plus for the pound, as many had thought that we may be in for a tricky few days and some political uncertainty, but that hasn’t been the case.
Political uncertainty can be damaging for a currency and it's no secret that there are numerous members of the Conservative Party that disagree with the current Brexit approach. As it stands they do not look like they are going to stop the Prime Minister in her tracks.
Dominic Raab (Brexit Secretary) also commented yesterday that he is optimistic for a deal to be reached in November. This gave the pound a slight lift and sterling ended the day as the strongest performing major currency.
I believe there will be a great deal of volatility in the coming weeks as the Brexit pendulum swings from one side to the other, and this will create great buying and selling opportunities depending on each new development.
If you are close to needing our services it would be prudent to make us aware of any requirements that you have so that we can keep you fully abreast of the latest action and to inform you of any spikes in your favour.
Exchange rates move by the second so these opportunities may not stick around for long, but if we are aware of a particular rate that you are waiting for we can contact you if it becomes available.
My personal view is that there will be waves of uncertainty over the next few weeks as the U.K and EU play cat and mouse with each other, but eventually they will cobble a deal together. How good that will be for the U.K is questionable at this stage.
We have very little in terms of economic data out for the rest of this week so Brexit comments from either side will be key for the performance of the pound.
With this in mind it may be prudent to consider booking either all or some of the currency you require to avoid any risk, there is the option of a forward contract, where you can lock in a rate for the future with merely a small deposit.
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