Whilst much of the focus has been on the UK during this period of uncertainty, its only a matter of time until the Brexit shock impacts the rest of the EU politically and economically. You can keep up to date with the latest exchange rates here.

Euro Driven by Political Uncertainty

Whilst much of the focus of Brexit is clearly focused on the UK and hence the pound, it must be remembered that the Eurozone will not come out unscathed. Whilst British banks are having a rough time so too are European banks, in particular the Greek and Italian banks which does not bode well for investor confidence and hence the Euro. The medium term outlook for the Euro is very unclear at present.

There have been new calls from within Europe for ECB president Jean Claude Juncker to stand down after the Brexit referendum. He has reportedly gloated about Britain’s withdrawal and has talked on German television about independence for Scotland and Northern Ireland which has been perceived as provocative. Other EU members have concerns with regards to further integration whilst both the Czech and Polish foreign ministers have publicly called for Mr Juncker to resign. It is Germany now though which is now adding pressure as well - Another head may roll… In these unusual markets which are largely being driven by unprecedented political uncertainty it is of paramount importance to be in communication with your account manager to take advantage of spikes in the market as well as reducing exposure to sharp market movements.

EU retail sales for May are released this morning as well as Purchasing Managers Index (PMI) data for the services sector. Retail sales are expected to show a small improvement in the numbers whilst the services sector should remain static. Whilst these are both important releases they are likely to be overshadowed by political developments surrounding Brexit both in the UK and across the Eurozone. European Central Bank (ECB) President Mario Draghi will be making a speech tomorrow where high volatility is expected whilst the ECB monetary policy meeting accounts are released on Thursday.

If youre concerned about recent developments in the EU and the impact of Brexit, our brokers are available throughout the day to answer your questions. Call us today on 01494 725 353 or email me at jll@currencies.co.uk for assistance.


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