Recent Brexit news helps the Pound push up
21 March, 2018
The week kicked off with the Pound making a surprise surge up after news broke that the UK and the EU have made some ways on the draft agreement for the Brexit transitional period – extending the status quo to 21 months after the Brexit date. Investor and the markets seemed to have priced in the expectation of a fairly successful transitional Brexit period ahead, but with many more discussions still set in the pipe line these peak levels could still disappear as quickly as they appeared.
With GBP-EUR rates back trading at the top end of its recent range, if you have an upcoming requirement over the coming weeks to buy Euros or Dollars now would be a great time to look at securing your currency. If rates are to follow the recent trend of the last few months then there is every possibility that the market could correct back down and see these current levels gone as markets adjust to the Brexit news. If you would like to lock in at today’s rates for a future transfer but may not have the full funds available then drop us a call and ask about our forward contract option. If you have budgeted to exchange your funds at a particular rate and concerned the rate could fall back then ask us about our stop loss and limit contract option. Both are great tools to help you secure the rates and maximise your return.
Yesterday morning the UK posted inflation figures which slowed more than expected. Inflation fell from £3% to 2.7% in February – This came as good news for consumers as it means the pinch on our pockets has reduced slightly. Despite lower inflation, market analyst reports are still speculating that the Bank of England could tighten policy and a rate hike could still be on the cards during the meeting in May. All eyes will be on the Bank of England on Thursday as its latest interest rate decision is announced and investors will be looking at the press conference and meeting minutes for any hints at a future hike.
The day ahead
This morning we have more data for the UK in the form of Average Earnings, Unemployment Rate and Public Sector Net Borrowing all out at 09:30am. After lunch at 14:00 the US post Existing Home Sales then this evening Fed Chairman Powell speaks and the FOMC monetary policy statement and rate decision is due. Markets have suggested that the FED Chairmen Powell may comment on the Feds decision to raise rates as many as 3-4 times this year, and New Zealand also post their latest interest rate decision at 20:00.
Should you wish to lock in a rate or simply have a chat with us about the market’s current direction then drop us a call on 01923725725 and speak to one of our friendly brokers today.
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