Last week the Pound was given a much needed boost vs all major currencies which also saw the Pound gain vs the Dollar by its single daily gain since 2008. Theresa May was very outspoken in her speech concerning Brexit and to me it appears a though she got in there first prior to the announcement of the Supreme Court judgement. The importance of the judgement appears to have lessened although I still think it could cause a lot of volatility when the announcement is made tomorrow.
The court will decide whether or not to reject or approve the government’s appeal against a previous High Court judgement, which meant that parliament has to approve any decision.
The decision is due at 09:30am tomorrow and in the run up to the announcement I expect the foreign exchange markets to move extremely quickly in the run up to and following the decision.
There are certain concerns that the decision could delay the triggering of Article 50 initially pencilled in to be triggered by the end of March. If the decision does not go the way of the government this could see a further delay as it means some MPs may seek further clarity as to what the plans will be for Brexit.
My personal expectation is that the Supreme Court judgment will overrule that of the High Court meaning that power will return to the government and allow them a clearer path with less obstruction. If this does happen I expect Sterling to make gains against all major currencies in a similar way following May’s speech last week. Good news for anyone selling Sterling to buy a foreign currency.
Since the turn of the year we have seen large falls for Sterling against a basket of currencies highlighting the need to use a currency broker who can help you with the timing of your trade. As a company our average length of service for our dealers is 8 years so with our experience we can help you along the way.
Clearly the main headline will be tomorrow’s verdict and with Theresa May due to visit Donald Trump on Friday it will be politics that are likely to affect what happens to Sterling exchange rates during the course of the week. However, there are still a number of release, which could affect the value of Sterling.
On Tuesday morning Public Sector Net Borrowing is due to be released which has in recent months tended to move the Pound by a noticeable amount so any change in the expectation of £7.2bn.
On Thursday UK GDP for the final quarter of 2016 data is due to be released with the expectation for growth to fall from 2.2% to 2.1%. This is a key measure of the UK’s economy so any signs of the impact of the Brexit uncertainty could cause problems for Sterling so it will be important to key a close eye on this data release for anyone looking to exchange the Pound.
The outcome of the Supreme Court hearing this week may have a significant impact on Sterling. Those with a currency requirement may wish to get in touch with one of our experienced brokers, as they may be able to assist you in making an informed decision. Call now on 01494 725 353 or email me - Tom Holian - at firstname.lastname@example.org.
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