Sterling Moves Lower

Following on from last week we saw sterling have a hard time against the euro and dollar with just over a four cent drop in a couple of days. This was a result of Boris’s new five week Brexit time line to the 15th Oct to get a post Brexit trade deal agreed.This agreement must be in place by the 15th in order for the UK to be prepared to leave ahead of December 31st. However Boris has stated if an agreement is not met the UK will be left with an Australian style trade plan with the EU. Because there is no distinct agreement in place as of yet this has left a massive amount of uncertainty to what is going to happen by the 15th Oct and so it is taking its toll on sterling’s strength.

Also to add to the mix and sterling’s weakness the UK’s corona virus cases have rocketed for a second time similar to back in the may lock down. With new tighter restrictions being put in place from today limiting groups to six people in an attempt to slow the spread. This now adds a lot of uncertainty to the currency markets as there is no clear end in sight to the virus until a vaccine or heard immunity has been achieved.

With the euro rate now dropping to new lows if you are a euro seller please take advantage of this as we are now not far off the best rate since march 2020 sell euros. To put in perspective how much you have already saved this last week if you were to have sold €100k at the beginning of the week and then compared to the end of the week you would have over £3k more.

Please get in touch with your currency consultant if you would like some guidance to get a strategy in place to limit your risk or even lock in this very desirable selling opportunity.

Eco stats for the week

14/09/2020

11:00 Euro group meeting

15/09/2020

09:30 GBP claimant count change

10:00 German ZEW survey

16/09/2020

07:00 GBP CPI

13:30 USD Core retail sales

13:30 CAD CPI

19:00 FOMC Interest rate decision

23:45 NZD GDP

17/09/2020

02:30 AUD unemployment change

07:00 EUR CPI

12:00 GBP Interest rate decision

18/09/2020

07:00 GBP Retail sales