MP’s attempts to block Brexit bill fail

The Pound is slightly higher this morning as the ‘Brexit Bill’ or EU Notification of Withdrawal Bill made its way through the House of Commons last night. Various amendments were tabled and defeated including more detailed reporting back to Parliament on progress of negotiations and ensuring the devolved administrations get a final say-son on the end deal. There is the prospect for further quarrels over guaranteeing the rights of EU Nationals in the UK which will form part of the debate for the next two days.

Sterling should remain susceptible to uncertainty over the safe passage of this Bill but few expect any serious hiccup in the passage of the Bill which will allow the legal trigger of Article 50.

The Pound is notably stronger against its counterparts from the January lows enjoying the benefits of some certainty over Brexit and continued strong economic data. The Bank of England has raised growth forecasts for the period between now and the end of 2019 indicating a smooth passage ahead whilst Brexit is being concluded. Continued good news for the UK and Sterling was also signalled yesterday by a 12-year high for new car sales being recorded in January. This all begs the question will this good news and buoyancy for Sterling continue?

Whilst we have some certainty over Brexit, economic data could still cause upset. This morning Retail Sales data pointed a less positive picture with Retail Sales for January down -0.6% versus the previous 1%. With expectations that higher inflation will in 2017 slowly eat into consumers back pockets the Brexit bounce helping many economic statistics so far and confounding the experts could easily run out of steam.

Will the Pound rise or fall in the weeks ahead?

With potentially only 1 month before Article 50 is triggered clients looking to buy a foreign currency with the Pound should be carefully considering their position. It is worth pointing out that Theresa May has stated no deal is better than a bad deal indicating if the negotiations start badly March could be a very rough time for the Pound if investors once again shun Sterling and Theresa May’s approach. Important questions over Brexit include will the two year time frame be enough? Will there need to be some form of transitional arrangement? There are still numerous unanswered questions over Brexit. So far these are not featuring heavily in the mind of the market but must be answered at some stage.

Further economic news comes this week with the NIESR (National Institute of Economic and Social Research) GDP (Gross Domestic Product) release on Friday. The end of the week also see lots of other UK data including Trade Balance figures and Manufacturing and Industrial Production. With Sterling benefitting from renewed certainty over Brexit but still at the mercy of many global events including Donald Trump’s plans for the global economy and political events in Europe now is an important time to be speaking to us about preparing your sterling currency exchange.

If you have an upcoming currency requirement there could be no better time to get in touch with your dedicated broker to detail your needs ahead of Brexit negotiations in March. Call us on 01494 725 353 or email me here and Ill be happy to answer any of your questions.

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