Hard or Soft Brexit

15 June, 2017

Nakhil Mahra

Yesterday didn’t shed any light on whether Theresa May and the DUP were any closer to reaching an agreement to form a coalition. Although, not many were expecting an announcement given the circumstances in London over the past 24 hours. The prolonged period taken to announce a coalition is only adding to the uncertainty we are currently seeing in the markets, which is by far less than ideal if you’re looking to send money abroad money abroad. The longer this takes and uncertainty surrounding the markets only means it is more expensive to send money, it is already costing you £3000 more to buy 100,000 EUR than before the election.

The chat in parliament currently surrounding on a hard or soft Brexit and if the result of the election will have any effect on the PMs views and her stance on the sort of Brexit she is looking for. With major figures in parliament now favouring a softer Brexit and hoping for a Norway-style deal it remains to be seen if Mrs May’s decision making will be influenced at all, further adding to a very fragile GBP currently. The quicker the situation is resolved at Downing Street we could see Sterling make a move in the right direction, however, if politics are anything to go buy over the last year we could be in for a long grind.

Data results out yesterday did not do much to the markets with GBP still struggling at the lowest levels seen since the Referendum last year. With a raft of results out today and any further negative news from the UK sure to send sterling into further turmoil, increasing your costs further. Speak to your dedicated account manager today to not be caught out.