Sterling begins week under pressure
20 August, 2018
With a fairly quiet last week for the major pairings in comparison to what we saw before it provided an opportunity for Sterling to gain back some of the losses, however, this proved far from easy. With mixed data from Europe and the UK trading remained within half a cent on GBPEUR. There was more movement on the EURUSD rate, with the USD reaching a year low on the EUR, continuing its gains that we have been seeing over the last few weeks. The GBPUSD pairing saw some respite with GBP closing Friday on the week high on the USD.
The biggest movement was with Turkish Lira, with the imposed sanctions from the US sending shock waves through Turkey. Not only the Lira but other currencies pegged to the USD seeing some volatility. However, there was some stability by close of the week and saw TRY claw back 8% on GBP, however, the rates still providing a good buying opportunity for those of you with TRY requirements.
Brexit talks started again late last week, with the uncertainty of what deal the UK will strike, if any, with its European counterparts still very much in the headlines. Recent comments made by Liam Fox that a No deal Brexit now stands at 60-40 the possibility now higher than ever. Uncertainty is the markets worst enemy, with the Pound remaining firmly under pressure. Already this morning, the GBPEUR rate is already down on Friday’s close, with any more negative news, we could see the lows of 1.07 taken out in the coming weeks. Is that a gamble you can afford to take?
This week is a quiet week on the markets as we close out August. With almost no data of note out, if we are to see any major market movements it will be heavily dependent on any Brexit updates.
3.30 pm USD Crude Oil Inventories
7.00 pm FOMC meeting minutes
1.30 pm USD Core Durable Goods
3.00 pm Fed Chair Powell speaks
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