• UK’s service sector continues its recovery, shaking off Brexit vote
• Theresa may makes groundbreaking speech urging the UK to ’embrace change’
• Sterling recovers slightly against its counterparts but further losses likely

The UK’s service sector found further support last month, due in most part to a weaker Sterling helping British exports. The latest release highlights a rebound from its Brexit lows but it remains questionable as to whether this is a sign of business confidence improving.

With the recent timescales of the invoking of Article 50 business confidence is likely to be tested once again.  Sterling began a free fall earlier this week when Theresa May confirmed deadlines for Article 50, a trend which will likely continue for some time.   Despite positive manufacturing and construction PMI Sterling is struggling to find support.

Theresa May urges UK to embrace new opportunities from Brexit

Theresa May made a groundbreaking speech during her Conservative conference, urging the UK to embrace the opportunities from Brexit by rebuilding a far, balanced economy. Echoing similar comments from her announcement over the weekend, the UK is likely set for a much harder divorce from the EU.

The Pound has recovered half a cent from the lows of this morning but those looking to buy foreign currency should make the most of the highs today.

Given the current trend, economic data is providing little support for Sterling with much of the downward trends due to Brexit uncertainty and therefore a fall in investor confidence. With the likelihood of a hard Brexit businesses may have to adapt to the potential of new legislation and restrictions on free movement. I am expecting GBPEUR exchange rates to fall to 1.10 in the weeks ahead and GBPUSD to fall below 1.25.

These trends could continue into 2017 so those looking to buy foreign currency should act sooner rather than later.