Could we be facing a Brexit negotiation breakdown ahead?
1 March, 2018
Yesterday the market was dominated by more Brexit news surrounding the draft treaty and a potential Brexit negotiation breakdown. The Pound lost almost a cent early on in the day as news was released regarding the draft legal agreement published by the EU which Teresa May rejected saying “no UK Prime minister could ever agree to it”. The comment is a reaction to the EU’s proposal of a customs and regulatory area regarding the Irish borders. Theresa May continued to say that the UK will continue to stand by its decisions made in December and is committed to a no ‘hard border’ result.
Across the water in Brussels the EU Chief Negotiator Michel Barnier spoke and said in a statement “if Brexit negotiations are to be successful we must pick up the pace” but given the recent news, trade agreements don’t look to be resolved quickly, and it’s likely that the rates could continue to slump the longer it takes for the UK and the EU to come to an agreement.
In the background Teresa May is also continuing to battle members of parliament on both sides, and former prime minister John Major gave a speech yesterday on the subject of Brexit projecting his views and said that Parliament should decide Brexit deal on a free vote and if Brexit flops there will be a terrible backlash.
All in all this recent news hasn’t provided a great outlook for Sterling in the coming weeks so if you have an upcoming trip to get out of the cold and snow and maybe heading for some sunshine to find your potential new property then get in touch with us here at Currency Index sooner rather than later. Don’t get caught out in the snow drift like many others and get in touch with us to discuss the various options we provide to help you secure your currency and help reduce the potential losses Brexit may kick up.
The Day Ahead
Already this morning we have had a few exchange rate news releases out for various countries across the EU and first thing this morning we have Euro Zone Markit Manufacturing at 09:00, followed by UK Markit Manufacturing, Consumer Credit and Mortgage Approvals at 09:30. At 10:00 the Euro Zone post their Unemployment rate which is expected to drop from 8.7% to 8.6%. After lunch it’s the turn of the US to post personal consumption, income and spending figures, as well as jobless claims all at 13:30. Canada also due to release Manufacturing PMI in the afternoon. At 15:00 the US also release their ISM Manufacturing PMI, Prices paid and Construction spending figures. Fed member Powell speaks and an hour later Fed member Dudley speaks at 16:00.
With lots going on alongside Brexit news there is lots to push the markets. Don’t get caught out and speak to your account manager ahead of needing to make any transfers. Remember the sooner we know about your currency requirement the more we can do to help. Our brokers will watch the markets on your behalf and alert you of any movements which can affect your upcoming transfers to help you maximise your return.