Article 50 Finally Triggered
30 March, 2017
Yesterday we saw Theresa May officially trigger Article 50, with the handing over of a letter to Donald Tusk by Sir Tim Barrow in Brussels.
This is the official start of the 2 years of talks to agree the divorce of Great Britain from the European Union and its now the crucial work starts by May and her cabinet to secure the best deal for the country. Trade deals will be negotiated and agreed, the biggest obstacle coming from the remaining EU states who have given mixed feelings about the exit. Some countries look to be heading potentially the same way, while others have criticised the UK for leaving. As Tusk stated, “we miss you already” and that there is “no reason to pretend this is a happy day”, Theresa May gave a strong address in commons putting into perspective the positive proposition this is and the Government’s stance on intended outcomes of negotiations. Now they have two years to deliver.
The markets took the news in its stride, with sterling making gains across the board as was thought it might, as the triggering has been known about for some time, and reported widely it would be today. Having been priced in to the market, it was a slight surprise to see further gains, giving those buying euros some of the best rates this year, gaining a cent and a half at its peak in trading on Wednesday.
German IFO business sentiment data first thing had little effect on sterling’s run, despite coming out better than expected as EU money supply missed the mark and dampened investor sentiment towards the single currency ahead of Article 50. There was no UK data to play with, so it fell to the PM’s announcement during PMQ’s at midday and that was the catalyst sterling needed.
Today is very data light with nothing happening in the UK or Europe at all and only a couple of data releases Stateside, being the trade balance figures and consumer confidence figures. The Bank of Canada chief Poloz makes a speech at 2pm, for anyone needing to buy the Loonie, that’s worth noting, while a few Fed members make speeches later in the afternoon, including the Chief Janet Yellen just before 5pm.
Could be a day or corrections for sterling so as the month comes to a close and the fall out of Article 50 rumbles on, if you have a transfer to make, be sure to contact one of the CI team early to discuss your requirements and the options available to you.
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