On Tuesday, we saw the release of the Supreme Court ruling on whether Parliament will vote on the triggering of article 50. It was extremely difficult to predict how Sterling would move following the announcement.
Theresa May made her intentions clear during a recent speech that she favoured a hard Brexit. This could be judged as detrimental to the UK economy short-medium term and you would expect Sterling to fall in value.
The Pound actually gained strength against most major currencies after the announcement of her Brexit plans. If there is one thing the market’s do not react well to it is uncertainty. The movement on Sterling after May’s speech goes to show that sometimes bad news is better than no news. With parliament now voting on approval of an exit bill, the big question is will Theresa May get her wish and the UK withdraw from the customs union and the single market.
It would not surprise me to see Labour make things difficult, the party has warned it is prepared to engage in “hand to hand combat” to make sure the Brexit process is under full scrutiny.
Such moves although said to be done with the best interests of the British public at heart, it could well cause the exit process to be elongated and problematic.
Theresa May has stated she will release a formal policy document on Brexit plans as requested by Parliament, I would expect this to remove some of the uncertainty away from the process and Sterling to rally.
The coming months will prove difficult for those who need to perform a currency transfer. There is potential for big swings on the exchange due to the Brexit situation. It is crucial to be in touch with an experienced broker who can pick a contract option to suit your needs and assist in timing your trade to maximise your return. Call our trading floor on 01494 725 353 or email me here if youd like to learn more.
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