The Pound has struggled today as enthusiasm over the Brexit progress fails to keep Sterling on the right track. Ultimately Sterling could now be at risk of further uncertainty ahead as the lack of clarity over any trade deal keeps the Pound on the back foot and investors second guessing which direction events will take longer term. Whilst progress on the exit relationship has been made, talks over the kind of new relationship the UK will enjoy are so far being overshadowed by comments from the EU that indicate the UK could lose access to the Single Market and make life difficult for Financial Services, a key lifeblood of the British economy.
The UK economy will get some fresh news tomorrow and Friday regarding the latest developments on the UK GDP (Gross Domestic Product) data and PSNB (Public Sector Net Borrowing) data, this could actually give Sterling a small boost, since the UK data has not been too bad lately. We will have to wait and see exactly what happens next with the latest figures for the UK, overall expectations for the Pound to rise centre around the UK economic data that is released and developments on Brexit.
If you have a transfer buying a foreign currency with the Pound, the good will being shown to the Pound currently could easily disappear as we enter the New Year and fresh concerns over the economic outlook and direction for the UK economy come to the forefront of investor’s minds. There are other factors to consider too, such as the prospect of the UK raising interest rates, however such a move could be very far in the future and may not actually see much of a change in the value of Sterling. All in all the current trends for Sterling show a move higher that has plateaued and now sliding, for client both buying and selling tracking the latest changes will key to maximising the position.