Deal, No Deal or No Brexit?

14 January, 2019

Matthew Boyle

The focus this week will be almost solely on the unfolding Brexit saga as we await the highly anticipated UK parliamentary vote tomorrow on the current withdrawal agreement, and indeed the next few days are critical for the Pound.

With most of the country and media outlets feeling it is an impossibility that this deal will make it through, many are now asking the question as to whether or if Brexit will happen under the current conditions, or even at all. Over the weekend the Media has reported that May herself now suggests that a No Brexit scenario looks much more likely than a No Deal Brexit, and as a result, we have seen GBP buying rates rally as this outcome is seen as a far more positive one for the Pound. Theresa Mays speech at a Stoke factory today will be an interesting one to watch as to whether this is mentioned, and to whether May will announce further EU concessions to the current deal in a bid to help get it over the line.

If her deal doesn’t make it through parliament there are suggestions of a backbench revolt in the Tory party or a call of a general election led by Corbyn and the Labour party, so at present, a huge amount of uncertainty remains prevalent as so many potential outcomes are still possible. What is certain is that this is a critical time for UK politics and the Pound, and as such we expect a particularly volatile week for GBP pairings. Whilst the current withdrawal agreement is unlikely if EU concessions are announced today might it squeeze through, or will the prospect of a no-deal scenario turn some backbench Tory heads? Will the UK bite the bullet and accept a No Deal Brexit? Or will what has been one of the most divisive political questions and events in our lifetimes rear its head again, in a No Brexit, a delay to article 50 or another referendum?

Without a doubt, we are in for a particularly busy week, and we will likely see significant movements in exchange rates.

If you have any upcoming transfers to make, stay in close contact with your Currency Index account manager who can keep you well informed of events unfolding and secure your currency quickly as required. Currency Index also offers forward contracts which help you secure your currency in advance, so if you are worried about worst-case scenarios you can remove the risk. Don’t get caught out by a potentially costly mistake by waiting and speak to us today for some friendly and professional guidance.

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