For those that have been holding off on a currency purchase are now presented with the best opportunity in 5 weeks, and the positive trend for the Pound could be set to continue. Due to a handful of unusual, sporadic events, the UK could be in a better position post-Brexit following a Trump victory.
Trump was an open supporter of the UK’s decision to leave the EU, and unlike his predecessor Obama, offers the promise of a front of queue deal with the UK.
But looking at the bigger picture, politics are moving in a different direction, people are tired of being left by globalisation and are seeking alternatives to the current political model. No matter what the cost, they are willing to stand against the establishment even against their own financial interests.
Despite countless arguments against Brexit, despite warnings of economic shock and higher consumer prices and a loss of GDP, the people grew tired of the status Quo because it didn’t benefit them. There options were limited, continue as normal or create attention.
And Trump is no different, Clinton had the whole backing of Wall street, Barack Obama, Beyonce, Lady Gaga and yet nothing could stop the Trump train. Despite all of the noise, the anti-Trump rhetoric and the mockery of his campaign, the US Dollar finds itself edging higher as markets come to the sudden realisation that the situation will not be as bad as many were anticipating.
But a Trump victory surely cannot be as economically damaging as the UK’s decision to leave the EU? So why has the Pound shot up against the Euro? And why does it continue in this direction?
Markets are facing the next set of tidal waves, and this time they are heading for the Eurozone.
A change in political landscape
They’ve made the same mistake twice now, and given the sentiment has shifted the European elections next year could sway voters towards the right-wing political parties. Italy’s Referendum in December could put an end to Renzi’s career with the far right 5-star movement building momentum. Whilst many claim a Le Pen victory in France as off the table I can’t help but laugh at the same media outlets reporting a Trump victory as impossible.
It feels as though something big is brewing in Europe and markets are growing increasingly anxious of the political landscape. The Pound could continue its positive run against the Euro in the mean time, and those looking to buy foreign currency could be in for an unexpected surprise.