Sterling exchange rates fell across the board of major currency pairs yesterday, as it appears that markets have lost optimism of a Brexit update later today as many had been expecting. The Sterling report below discusses this in further detail, looking into the potential ramifications of no update on Brexit. The table below displays the range of exchnage rates during the past month, showing the difference in a number or currencies you could have received in return when selling £200,00.00.
|Currency Pair||% Change||Difference on £200,000|
The EU Summit begun yesterday with a heavy focus on the topic of the migration crisis and how it’s threatening to break up the EU. The topic is dominating the discussions with a number of market commentators now expecting to see Brexit talks on the backburner, although Brexit is supposed to be the main focus of the Summit today.
Economic news will be highlighting how cable (GBP/USD) hit a fresh 7-month low of 1.3066 during yesterday’s trading session, and also how GBP/EUR hit a 3-month low of 1.1274. If you’re holding these currencies and plan on exchanging them into Pounds it’s certainly worth making your broker aware as the rates for buying Pounds are some of the best we’ve seen in while.
If the Brexit talks are discussed today as originally planned, I would expect to see the EU negotiators continue to play hard ball. It’s becoming clear that Brexit is coming at a hard time for the European Trading Bloc, and I would expect that in order to warn off other countries from taking a similar route, they will continue to make it difficult for the UK.
The next major event for the Pound is expected to be the White Paper which will outline the government’s Brexit position. It was supposed to be in place before the current EU Summit but it’s been delayed, although this morning May has announced that she will release it shortly and expects Brexit talks to accelerate once it’s released. Once this becomes public, I think there could be movement for GBP exchange rates. It’s unlikely to be released until after the 6th of July when Theresa May will be looking to agree the UK’s blueprint for its future relations with the EU, along with her entire cabinet at her Chequers residence.
Longer term the trade-off between Brexit uncertainty and the potential for an interest rate hike from the Bank of England is likely to influence what the Pound will do next. Do register your interest if you wish to be kept updated in the event of a major move for Sterling.
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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