Yesterday was a quiet day in terms of data releases, as the market continued to digest yesterday’s surprise news of a UK general election called for June 8th, and also ahead of the first round of the French elections this weekend. The only data released of note was from the Eurozone who posted trade balance data (which showed a marginal improvement) and inflation data which came in as was expected. As a result, we did not see huge movement in the rates- GBP>EUR dropped just over half a cent and GBP>USD by around ¾ of a cent.

Given the huge spike yesterday, this is not too unusual as often after a large expansion in rates as we have seen in the last 24 hours a contraction often follows. However, this may in fact not be the case when looking at GBP/EUR rates. At present, they are sat close to the best they have been since the referendum last June, having touched this level 5/6 times but never having broken it, so are these the best rates we are likely to see in the near-term?

Indeed, the next few days and weeks poses a tricky road for the market as we have a few big events which could see rates move. This weekend we have the first round of the French elections, which depending on the outcome could see the GBP>EUR rally if Le-Pen is looking strong. Equally her chances of winning look diminished we could see the rates quickly drop as the risk of her webbing to the market will already be priced in. Add to the mix that Melanchon who represents the Left wing in France also wants to call a referendum, the weekends result is no easy call or what it will do to the rate, and those of you who do wait certainly take a risk! If you have not already considered your position get in touch with your Broker today so you are not potentially caught out with what could be a big movement.

After this weekend, the focus will largely shift to the UK as the election approaches within 6 weeks. At present, it seems the market has reacted to Theresa Mays bullish call for an election with vigour as we have seen the Pound rally. However, as we know elections bring uncertainty so again in the coming weeks will we see the Pound struggle if Mays current position of power be tested? It certainly is a high risk/reward strategy from the PM, so don’t be surprised regardless of this weekend’s French results we see a bumpy road in rates for the next couple of months. Given some of the shock results we have seen in the last 12 months, some of you may like to consider taking the risk out and trading now at what are some of the best levels we have seen in months.

Today is another quiet day for Ecostats, with the only real releases of note being Bank of England Mark Carneys speech at 15.30 and US Treasury Secretary Mnuchin’s speech at 17.15. With sentiment largely driving the market now and volatility only increasing, should you have any upcoming requirements give your Currency Index Broker a call today for some friendly and professional guidance on how to get the most out of your currency transfer.