Pound hits 2 month high against EUR & USD
24 January, 2019
Yesterday saw the Pound rise to new 2019 highs against both the EUR and USD, taking it to the best rates we have seen in over 2 months. Following a decline in the unemployment rate on Tuesday, we saw the Pound start to gain ground, and it seems in the past few weeks the sentiment towards ongoing Brexit negotiations has also changed. Many now feel that we are moving away from a No-deal Brexit scenario, with the feeling growing that either we will extend article 50, or in fact not Brexit at all.
There are also rumours, that if May can negotiate some more concessions and crucially a time-limit on the Irish backstop, that the DUP and many of the Backbench Tories will in fact back a deal as it removes the chance of No-deal or of an extension. In what is an increasingly complicated and unusual situation, this increased uncertainty has seen the Pound strengthen, as it seems to play to Mays favour, decreasing the chance we will leave with no Deal at all, as Brexiteers would perhaps rather back a poor deal than no deal at all.
There is danger here though, particularly regarding the current exchange rates. As we creep ever closer to the vote next week, and indeed the March Brexit deadline, uncertainty has never been higher. Yet the market (as we can see reflected in rates) is currently very Bullish, and is heavily backing GBP. As such, those of you reading this might like to take caution and consider taking advantage of these current highs and securing currency now.
Should vote get lost again next week (which is a very real possibility) we could see the tides of sentiment turn quickly again and the 2-month high rates we currently see drop back by the 4% or so they have gained in recent months – a significant amount, particularly when transferring a large sum.
Speak to us to today for some friendly and professional guidance on how we can help you to remove the risk, as the clock ticks and uncertainty only increases.
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