The pound continues to look more buoyant this week having continued its rally against the Euro whilst remaining steady against the US dollar. Rates for GBP EUR have almost broken 1.18 and it looks like it may reach the target before the Easter weekend. Those clients looking to capitalise on the improved rates would be wise to get in touch as there may not be that much more room left in this rally.
UK unemployment data was strong this morning with the headline figure remaining at a low 4.7%. However the wage growth numbers remained subdued and these numbers are something the Bank of England are very interested in. As such the Bank of England is unlikely to be raising interest rates any time soon which is likely to prevent any major gains for the pound.
UK data is light as we approach Easter with just a survey of bank of England credit conditions released tomorrow morning. UK retail sales data next Wednesday should be more interesting and any suggestion the British consumer continues to spend will be seen as positive for the economy and hence the pound.
GBP EUR in my opinion could strengthen further as the French election draws nearer with the first round of voting to be held 23rd April. How well Marine Le Pen performs in this election will effectively determine the direction for the Euro. The markets are likely to start to price in the potential of such an outcome and this could see the Euro weaken off in the next few weeks. This is a major factor for sterling Euro exchange rates and those clients buying Euros looking to achieve a big gain could see a great opportunity if Marine Le Pen does win power.
Brexit continues to bubble away although now that Article 50 has been invoked the markets do now appear be ready for the process of withdrawal from the EU. A meeting between EU 27 will be held 29th April where the overall stance to deal with Britain will be discussed. Any developments after this meeting will likely result in GBP EUR reaction although in my view with the French elections rapidly approaching there is unlikely to be anything too strong or controversial from the EU. There is also already talk that the Brexit negotiations may need to be postponed until a new German government is in place which could take things up until November. The German elections are being held in September and so this leaves an extended period of uncertainty for the pound
If you would like further information on sterling exchange rates or any of the major currencies and to discuss how we can assist then please feel free to contact me on 0044 1494 787 478 and ask one of the team for James. Alternatively, I can be emailed directly on firstname.lastname@example.org