This morning the UK and the EU negotiating teams met for the first time face to face. The talks were thought to have been positive according the UK Brexit committee and hopefully news starts to break of where the conversations are going. If there was to be progress made early on then hopefully this could begin to have a positive effect on Sterling, however clashes in negotiations could have a detrimental effect.
European leaders have been very clear in suggesting that the UK needs to pay a settlement figure before they can consider talking about a free trade deal. The UK’s future very much relies on a good trade deal and the EU are making it clear that’s the last thing that will be discussed in negotiations.
The main topic of the first few meetings will be coming up with a complete timetable and agenda. There are so many topics to cover and realistically there are only 18 months to work everything out. Once the timetable is clear it may be easier to determine what might have the largest effect on the currency markets. Access to the single market is the main factor from the UK’s perspective, however freedom of movement is also significant for all the British expat communities throughout the EU.
Mark Carney Speech Tomorrow
Bank of England Governor Mark Carney will speak tomorrow and there could be significant volatility. The Bank of England Monetary Policy Committee last week revealed a 3-5 split in favour of keeping rates on hold. However due to the recent jump in inflation there appears to be appetite for a hike judging by the vote from the committee members.