Okay so such an analysis seems slightly against the grain considering the headlines and news all pointing towards the tough negotiations for the UK in the Brexit talks. A much lower chance of an interest rate hike is not helping matters and the worsening economic outlook for the UK is yet another worry on the back of the pound. Sterling weakness has been very apparent against most currencies, particularly against the Euro which has seen almost 3 cents movement downward this week. The US dollar is a little softer as Trump continues to struggle to meet expectations, the Australian dollar is much stronger against sterling as they look to possibly raise interest rates sooner.
What will drive sterling higher possibly is the outcome from the Brexit talks. In a week where sterling has been fairly immune to the political developments I would expect some bigger movements in the future. It is becoming more and more apparent that a hard Brexit is now off the table and in the future it is much more likely we will see a softer Brexit. This should see the pound rise in the future as it becomes more and more likely some kind of deal will be done.
As the worst fears subside hopefully the pound will find strength but unfortunately for clients waiting for this to happen, it could prove an expensive gamble! If you have a transfer to make buying or selling the pound next week’s GDP (Gross Domestic Product) data could well move the market. For an up to date overview of your position and the latest news and information on the rates please speak to me Jonathan Watson by emailing firstname.lastname@example.org