Brexit Talks at Critical Point

28 October, 2020

Matthew Boyle

Brexit talks are reaching a critical point as UK and EU teams are still seemingly at an impasse over an agreed trade deal with the clock ticking down. The EU team are currently in London until later today trying to find a solution, but it seems agreement over fishing rights are still the main point of contention to a deal being reached. As a result, the No-deal scenario could continue to play out, and as we crawl towards the end of the year and the Brexit deadline pressure continues to mount, particularly on exchange rates.

Whilst some analysts suggest a deal is still likely, reports suggest Macron and the French are unwilling to budge on their demands to a long term deal and access to UK fishing waters. So as the deadlock continues GBP>EUR rates remain relatively stagnant, with pressure building and increasing the chance rates will move quickly depending on whether an agreement can be reached or not.

Certainly, the media and market seem split as to their view on this with Market analysts pointing to a likely 5% shift up or down depending on the outcome.

Outside Europe, much of the market remains focussed on the approaching US Presidential election next Tuesday. Again here the market is heavily split as to whether Trump will secure another 4-year term, or if Biden who seems ahead in the polls will emerge Victor. And with Covid affecting all markets amidst this uncertainty, we can be sure of one thing – the next few weeks will be a turbulent one for the market and exchange rates.

Speak to your Broker today for some strategies to help you remove some of this uncertainty and protect your transfer against what could be some big swings, should things go the wrong way for you.