Deal agreed

27 June, 2017

Nakhil Mahra

Yesterday finally a deal was agreed between The Conservatives and the DUP after days of negotiating between both parties. However, will it pass the final test of the Queens Speech vote later this week? As a failure to get in is sure to send the pound into further turmoil, with talks of Tory rebels not backing Mrs May her position to lead a minority government is far from guaranteed. Yet further uncertainty to add to an already sensitive market. With no other major data out yesterday, the rates continued to trade at similar levels throughout the day.

The bailouts for both Greece and Italy did not have major effects on the GBPEUR rate or USDEUR rate showing the current strength of the Euro against both its major pairings. With investors still choosing to favour the more stable Euro.

With eyes very much on Brexit negotiations and the early focus on the rights of EU nationals in the UK and British expats in Europe, will May break and give in to Brussels’ demands or hold her own and stick to the deal she had originally put on the table she described as a ‘fair offer’. Should there be further delays in confirming these rights we could see your costs increase to send money abroad.

Today is a fairly quiet day on the data front however it could be important to keep an eye on Draghi, Yellen and Carney all speaking today with any major announcement from any or all three sure to disrupt the markets. Stay in touch with your CI account manager today to discuss all your needs.