Sterling Slide Continues

8 August, 2017

Simon Eastman

Monday saw the pound start the week as it ended last, falling across the board despite positive house data.

The Halifax house prices report showed a better than forecast reading, with an increase in prices of 2.1 percent, over the expected 2 percent, but this was down from last month’s reading. The month on month figure also improved to 0.4 percent, from negative 0.9 percent last month. Although this is a positive thing for the economy, it pales into insignificance compared to the news from last week over interest rates and the UK’s downgraded growth forecast.

It was a quiet day for eco stats with some low key readings from Germany and the EU, along with Swiss inflation which came out as expected and had little effects on the markets. For the US, we had a couple of Fed members making speeches in the afternoon but again, these had little effect on the markets which saw the pound lose less than half a cent against both the euro and the US dollar over the course of the day.

Today is likely to be much of the same with no UK data at all to go off, so expect the slid to continue as sentiment is away from the pound and negativity surrounding the Brexit negotiations continue to dominate headlines. German trade balance figures were the most key release today which have already been released, coming in over expectations so that could see the euro start off trading on the front foot yet again.

With that in mind, any imminent trade you might need to do could be worth locking in sooner rather than later, to avoid seeing that exchange rate get even worse. Speak to one of the CI team today for a quote.