Will this Sterling rally continue?

The Pound is touching some of the best rates all year to buy Euros and US Dollars as some clarity over Brexit takes away the worst fears and economic data for the UK remains mixed but positive. The Euro and US Dollar have both gradually been weakening in the last couple of weeks painting a picture of a higher Pound that is not necessarily as rosy and true as first appears.

As Storm Doris batters the UK another headwind is looming in the distance. Whilst the subjects are becoming a little boring for even the most ardent market analyst like myself, ‘Brexit’ and ‘Article 50’ will soon be top of the agenda again. Sterling is still at multi year lows against the ZAR, CAD, AUD and many commentators still believe Sterling can fall lower later either once Article 50 is triggered or if Inflation rises faster than expected.

For now The Article 50 Bill should safely make its way through the House of Lords for any great setback would potentially see the House of Lords abolished. As principled as many a peer is, risking his own livelihood should ensure the Bill is not thwarted and from mid-March the clock on Theresa May’s declared intention to trigger Article 50 looms. Clients looking to buy or sell Sterling need to be on guard for some tricky days and weeks ahead. Any day we could hear news on what is around the corner which will drive the rate, being prepared is vital to maximising your chance to get the most from the market.

As confirmed by the Conservative’s strong performance in the Copeland by-election last night Theresa May has a strong grip on power in the UK and will be drive through the Brexit she is envisaging. With the opposition in tatters markets are being supportive of Theresa May and her plans for now. However as we know financial markets are very fickle, have bad memories and expectations set too high can often lead to disappointment.

Sterling buyers and sellers should use their time wisely

Mortgage Approval data today at 09.30 should continue to reflect an economy that is faring better than expected post the vote although the next real key data is next week from Wednesday where we get the latest Purchasing Managers Index surveys.

Against the Euro and the US Dollar and as so often is the case in the currency markets it is not so much a question of a currency being strong, more that the rest are weaker. A £200,000 transfer today into Euros buys €12,021 more than the lows of January and €17,682 more than October last year. March is shaping up to be one of the most volatile months since the Brexit vote last June so it is critical to keep us informed of any pending transfer so we can monitor developments for you.

If you have a Euro, US Dollar or other foreign currency requirement in the coming weeks, now could be an excellent time to get in touch with our dedicated team of brokers. The Pound could suffer a setback once Theresa May invokes the much anticipated Article 50. Call us today on 01494 725 353 or email me here to find out how much we could save you.


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