Last week’s end saw much anticipated gains for the Pound against both the Euro and US Dollar. The difference in last week’s high and low could have earnt an extra €1410 or $2,040 on a £100000 transfer. The table below shows the difference you would have received when buying £200,000 at the high compared to the low over the last month:

Currency Pair% ChangeDifference on £200,000
GBPEUR2.71%€6,288 EUR
GBPUSD2.71%$7,740 USD
GBPAUD4.3%$11,431 AUD

In the second week of April, the UK Manufacturing and Industrial Production data was lower than expected compared to past months however attributed to the “Beast of the East” weather conditions.

UK/EU Customs Union debate still on going

Public vote on Brexit deal?

On the Brexit front, the Pound is seemingly interpreting no news as good news for the moment. This contributed to the Pound's gains last week. On Sunday, the People’s Vote held a rally to call for a public vote on the final Brexit vote. 1,200 people were at the event, including MP’s, celebrities and business leaders, whilst pro-Brexit campaigners gathered outside. At present, it seems unlikely that a people’s vote on the final deal will take place at all. The UK will formally cease to be a member of the EU in March 2019 and although the transitional period has been extended to 31st December 2020, there will be a Commons and Lords vote to approve whatever deal is agreed at the end of the two-year process.

There is a possibility that MPs could block Brexit, but the EU side would need to agree also. This would mean leaving the EU without a deal, rather than halting negotiations. Both the Conservatives and Labour have ruled out a second referendum.

One hopes that Theresa May’s government and the EU reach a final deal on the Brexit terms by October as I fear the contrary – as well as movement for a people’s vote - would weaken the pound.

The next Brussels summit - on June 28-29 - looms large and I expect the GBP to fluctuate more as and when new information is made available. In the meantime, we are experiencing 11-month highs of GBPEUR and may now be the time to act.  

Big week for data

UK labour market is due from tomorrow. The labour market report for March – will include the closely watched average weekly earnings indicator. The average weekly earnings excluding bonuses are expected to rise 2.9% year on year in three months ending in February, rising faster than inflation for the first time since January 2017 when inflation reached 1.8% year on year while wages rose 2.2% year on year. The unemployment rate is expected to fall to another multi-decade low of 4.1%.

This combined with strong inflation and retail figures on Wednesday and Thursday respectively should see the pound strengthen further. We strongly recommend touching base with your Broker to capitalise on movements in your favour.

For more information on how future events could affect exchange rates, call our trading floor on 01494 725 353. If you would like to keep track of rates you can visit our live foreign exchange rates page or set a rate alert.

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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.