Last night saw Sterling fall in value following Parliament voting in favour of the Brady amendment.
MPs voted for an amendment by 317 votes to 301 to pass the Brexit Deal bill if Theresa May can negotiate changes to the Irish backstop.
She has pledged to return to Parliament with a deal to be voted on by 13th February if Brussels are willing to make any concessions, which is a big if.
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European Parliament Brexit Coordinator, Guy Verhhofstadt stated yesterday that European Parliament will block the withdrawal agreement if there are any amendments made.
This backs statements made by European Commission President Jean Claude Junker, who has stated on several occasions there will be no concessions made.
Many still believe this is posturing, but it is important to remember when May attempted to renegotiate her deal following a postponement of the Parliamentary vote in December she was stonewalled by Brussels.
Following a dip in Sterling value last night I would be taking advantage of current levels. I fear May will have a great deal of difficulty getting any concessions on the Irish back stop and I feel Sterling’s recent spikes against the majority of major currencies lacked justification.
If you have an upcoming currency requirement, you could consider purchasing at current levels, but if you have a longer time scale I would suggest getting in touch with one of our brokers to come up with a firm strategy to try and maximise your return.
There is little data of consequence released from the UK this week. We have consumer credit and also mortgage approvals later today, but I do not think this will have to much influence on the rates. Brexit remains the key driver for Sterling.
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