Spain may scupper Brexit deal

Yesterday was another poor day for the Pound as ongoing Brexit uncertainty continues to weigh heavy on exchange rates. In what is a quiet week in the way of market data, sentiment continues to drive the market, and at present that is unfortunately against the Pound.

In what is a minefield of uncertainty, yesterday saw Spanish Prime Minister Pedro Sanchez that Spain would vote NO to the current Brexit deal without changes and concessions to Gibraltar. In what is already a difficult situation, and one where the EU has said there will be no further concessions this only throws another spanner in the works and increases the likelihood we are moving towards a no-deal scenario. Add to this that even if concessions are made, Theresa May still needs to pull off the seemingly impossible and get the Brexit plan through Parliament it does leave the Pound vulnerable.

Given that at present we are still seeing it trade at levels which would suggest a deal is still likely, many of you may like to take advantage of the rates before the house of cards comes falling. A number of market analysts are suggesting the Pound is overpriced given the current situation and outlook, and if we do continue down the road of a No deal a drop of over 5% in rates is more than likely.

With no data today Brexit will continue to be the market’s focus, and with the negativity towards the current deal slowly increasing it does feel like it is simply a matter of time before we see Theresa May, her Brexit plan and exchange rates come crashing down.

Speak to your Currency Index broker today for some friendly guidance on how to remove the risk of the rate dropping in an increasingly uncertain market.