Daniel Johnson
Senior Executive Dealer
Be wary of thinking a Brexit deal is sewn up
Brexit progress continues to dictate the value of sterling.
Request a quoteSterling value continues to be dictated by the state of play in Brexit negotiations. We have seen significant gains for sterling this week against the majority of currencies following rumours that the UK financial services sector will have access to the customs union post-Brexit and that an Irish border deal is on the cards.
These are the two major points of contention, the UK Financial sector generates a huge amount of tax revenue and I think Brussels were very keen to get their hands on it. The Irish border deal that has been rumoured to be acceptable is very similar to Theresa May’s original offer whereby any tax owed is payed retrospectively.
| Currency Pair | % Change in 1 month | Difference on £200,000 | |
|---|---|---|---|
 GBP |  EUR | 2.2% | €5640 EUR |
| GBP |  USD | 4.2% | $11000 USD |
| GBP |  AUD | 4.5% | $16920 AUD |
Although news in the press has been very positive I would be wary of thinking everything is going to be sewn up and sterling will continue its advances. If we look at GBP/EUR for example, 1.15 has been a key resistance point for over 18 months. We approached 1.15 in the last few weeks following news that an Irish border deal was to be accepted, only for Chief EU negotiator, Michel Barnier to rubbish claims. The GBP/EUR rate then dropped to the 1.11s. It is also important to remember that even if a deal is made it will still need to go through the House of Commons in January so gains may be limited until the deal becomes binding in January.
If a deal is forthcoming we could see an EU summit on 21st November, if this is announced expect sterling strength.
GDP data could cause volatility
Tomorrow we will see the release of GDP data and this could have a bearing on sterling value. I am of the opinion it does not have its usual clout due to Brexit dominating the news and in turn influencing investor’s decisions. Quarter on Quarter there is expected to be an increase from 0.4% to 0.6% and Month on Month we are expected to see a rise from 0% to 0.1%.
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A. Hawgood
UK
From start to finish with all contacts you feel like a VIP client even if you are exchanging small amount of currency. Always polite cheerful and give you straight talking advice before making the decision. Daniel Johnson and the team are a pleasure to deal with.
C. Lafferty
UK
Daniel Johnson was very helpful throughout the transaction. It was quick and hassle free. I would definitely use this method again.
D. Scamans
Excellent… can’t fault it… Thankyou Daniel.
I. Armstrong
UK
Daniel Johnson explained clearly and in an easy to understand way what the process would entail before I made the transaction to pay the deposit on an overseas property. The transaction was carried out in an efficient and timely manner and I felt no pressure at any time.