We have seen Sterling exchange rates fall over the last couple of weeks from recent highs- falling to 1.12 against the Euro and 1.2790 against the U.S Dollar. It seems the only reason for this is that investors have lost interest in Sterling while the UK is still struggling to make a deal with the EU. The main issue still seems to be the Irish border, where we keep hearing conflicting reports that are not helping the Pound at all… It seems that the only thing that can help now is a definitive decision about a deal/no deal.
The UK Government still seem confident that a deal will happen, however, are taking massive precautions in regards to a no deal Brexit- which is not helping the Pound- every headline is, unfortunately, delivering another blow to Sterling.
The only thing keeping the GBPEUR exchange rate from falling further right now is concerns in Italy, however if this gets sorted before a deal for the UK, then we may see the Pound fall further against the Euro- and with more interest rate hikes expected from the Fed, we could see a further fall against the U.S Dollar.
In regards to data, there are quite a few releases this week which could have an effect on the market which is worth being aware of;
- UK mortgage approvals
- USD Personal Consumption Expenditure Core
- French GDP
- German Unemployment Data
- Italian GDP
- Eurozone GDP
- German CPI (Inflation)
- Bank of England Rate Decision
- USD Jobless Claims
- Non Farm Payrolls
If you have an upcoming transaction and would like to know how you can hedge yourself against the above events- please don’t hesitate to contact me.