From Strasbourg With Love
12 March, 2019
Yesterday evening, Theresa May made a last-ditch visit to Strasbourg. After a hurried meeting with Jean Claude Juncker, Theresa May announced that she now has legally binding amendments to the Northern Ireland ‘Back-Stop’.
Today the ERG (European Research Group) are looking through these new additions with their lawyers, to see if there is any room for manoeuvre. Another key announcement yesterday was when Jean Claude said ‘irrespective of how the GB Ministers Vote, the EU will not meet again around the negotiating table’.
You may also have heard that this week is a ‘make or break’ week for Theresa May. Hold on, where have we heard that before? It is widely believed that today’s’ ‘meaningful vote’ will be voted down by the majority of MP’s in the house and with a further two more votes this week on the cards (Wednesday & Thursday), this really could be the most telling week for the Prime Minister in her ministerial career.
With just 19 days left until we are supposed to leave the European Union, Theresa Mays’ deal looks doomed to suffer its second historic defeat. Then MP’s will have a vote on whether we leave on March 29th, with potentially a ‘No Deal’.
There is also a chance that Ministers could get a vote on delaying Brexit, which could lead to a softer ‘Norway-style’ exit, a second referendum, or even no BREXIT at all. Throw into the mix the belief that Theresa May will be ‘usurped’ by the end of the week, (potentially giving us a new Prime Minister) and what a week we have in store.
What does this mean for sterlings’ relationship with other currencies?
Well, today we have the Trade Balance figures. These figures show the difference between the imports and exports of goods. When exports are greater than imports, then the UK experiences a trade surplus. Britain’s economy is highly trade driven, which means Trade data can give critical insight into any developments in the economy and into foreign exchange rates.
Exports are usually purchased in Sterling, which greatly helps with the appreciation or strength of Sterling. Negative trade figures (or a deficit) today will indicate that imports of goods are greater than exports and for a strong economy, it helps to export more than we import. These figures also include the month on month Manufacturing Figures, the Industrial Production figures and the GDP figures.
‘Across the pond’, the big releases of the day are the year on year U.S Consumer Price Index figures incorporating the Food and Energy figures. These figures assess change in the cost of living and the consumers’ ability to spend. Strong figures could see a resurgent but ‘Brexitly’ (yes I made that word up) confused Sterling Dollar pair, weaken against the dollar.
Did you know that there are products and services available, which can help mitigate the risks currently faced by needing to make a purchase or transfer in these dubious times. Why not speak to your Currency Consultant or if you are new to the Currency Index website, why not register an account today so we can discuss your options with you.
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- No Deal Brexit A Real Concern 22 March, 2019
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