Foremost Currency Group

Make the most of your currency

Talk to our friendly team:+44 (0)1442 892060

Sterling Slipping

Jack Wiles - A Flagging Pound Jack Wiles
Currency Broker
T: 01442 892073

Sterling fell by around a cent yesterday afternoon after Ben Broadbent, deputy Governor of the Bank of England, warned that if trade links between the UK and the EU are weakened in Brexit proceedings, both parties would suffer higher prices and lower exports. He skirted around any discussion of future BoE monetary policy, which was the cause of the pound being buoyed prior to his speech.

To put this move into monetary terms, purchasing €300,000 prior to Broadbent’s speech would now cost over £3,500 more.

Where is the pound going next?

It’s really nice to see that market movement is being caused by talks of Brexit, not something that has happened often in recent times… EU growth has finally tuned positive and at the same time the UK’s economy is massively suffering following the vote to leave the Bloc. Inflation is almost past the Bank of England’s 3% limit, manufacturing production & house prices are now negative and construction, manufacturing and services PMI figures are slowing. It seems as though this is a trend that is likely to continue for some time; at least until there is more certainty around the UK’s exit deal.

Even with all of this going on however, GBP/EUR is still comfortably above the 1.10 mark. Many analysts are touting for the rate to be closer to parity by the years end but if negotiations become positive for the UK, I feel it is extremely likely the rate could get closer to 1.20, if not higher.

The probability is that this will not be the case but without being in contact with one of our dedicated account managers here at Foremost, you will not be able to take advantage of or mitigate any movement in Sterling pairs. If you don’t already have a free, no obligation trading facility, click here to open one today, or contact us on the details below.

Today’s Data

From the UK today the highest impact data will be at 9.30 in the form of the quarterly average earnings index. The UK’s unemployment rate and claimant count change will also be released at the same time. There is no noteworthy data form the EU but across the pond FED chair Yellen will testify at 3.00pm and crude oil inventories will be released shortly after. Both US releases are likely to have an impact on USD crosses.

GBP/EUR

Jack Wiles
Currency Broker
T: 01442 892073

© Copyright 2013 to 2017 | Foremost Currency Group Ltd | All rights reserved