Last week we saw the pound continue to make steady gains against the single currency. We now await further news from the Brexit negotiations. Talks are due to take place almost every day to try and break the deadlock and Boris Johnson still standing strong on his promise to leave by the 31st October.
The prime minister of Finland, had stated ‘Boris Johnson had 12 days to set out his plans’, however the European commission had confirmed that they had indeed received documents and talks were ongoing, so are we closer to a deal then we think? Reports on the BBC suggesting the 17th October could be the make or break day.
The biggest news of last week came on Thursday evening, when Juncker stated a deal might be likely, the papers submitted earlier in the day clearly pressed talks forward. What the papers said hasn’t been shown to the media yet, Boris Johnson clearly wanting to keep his cards close to his chest.
The Bank of England meeting took place last week, the last one before we leave the EU. Inflation figures in August at 1.7%, below the 2% target of the Bank of England (BoE), with the lower figures it would have been worth noting if this would have affected the decision of the BoE on their interest rate decision. The BoE kept the rates at 0.75% however and stabilising the exchange rates against the USD and Euro once again, pushing the GBP/EUR rate to touch 1.13 once again but failing to break through further.
The euro touched a 3-month low against the pound last week, following its own recent issues. Spain looking to go back to the polls, and Italy having its own separate issues, who’s government has been shaky for a while now.
There were threats of a recession after the German economy showed signs of shrinking, which is often seen as the powerhouse of the Eurozone, sot this could result in volatility for the single currency. Germany incidentally also being unhappy by the Quantitative Easing process and were reportedly uncomfortable with more money being pumped into the economy. The current issues surrounding the EU could well mean good news for sterling, should we get a deal and these issues continue for the EU, there could be a possibility for the pound to make some gains.
There was positive news for the US, where data showed continuous growth, fed chair Powell predicting further growth in the coming months, the US economy has seen 11 months of consecutive growth, however he warned that the ongoing trade war would weigh down the economy in the short-term. The labour market showed strength too, less unemployment applications going in, which should support the economy with further growth. The only dampener on the US economy being the manufacturing sector, shrinking month on month by comparison.
Reports suggest the real effect of the attack on the Saudi oil haven’t really been felt, where the worse is yet to possibly come. This could mean the trade war between China and US could ease, where Chinese buyers will be looking to the US for crude oil supplies.
The AUD remained under pressure throughout the week, with the RBA suggesting they could cut the interest rates again. With unemployment rising and the trade war between China and the US pushing investors away from the AUD, we could see further volatility. AUD buyers may want to keep a close eye on the rates.
All the staff I spoke with were helpful ,courteous and knowledgeable. The service is efficient and FCD make the exchange process hassle free.
Personal, attentive. What more can I say? First Rate.
Efficient, friendly, personable – I have used this service several times and will not hesitate to call on them the next time a foreign currency transfer is required.
Quick, competent and friendly: a reassuring excellence of service, which I heartily recommend to every potential client.