The pound continues to remain under pressure against the Euro for the two principle reasons of Brexit and a strong Eurozone economy. Brexit remains the single biggest driver for sterling exchange rates and the lack of clarity over where it will end up is keeping sterling at bay. The Great Repeal Bill is being debated in parliament and will be voted on at midnight on Monday next week. This is crucial in terms of getting the legislation through to avoid any legal cliff edge scenarios when Britain formally leaves the EU in March 2019.
Any upsets with the vote should any Conservative party members vote down the bill could see considerable volatility for GBP EUR exchange rates. My view is that the bill should just scrape through without a hitch but it would only take six conservative party members to vote against the party and that could leave the UK in a very precarious position with considerable risk to the downside.
As far as the Euro is concerned the European Central Bank met yesterday and although no tapering to its asset purchasing scheme was made the central bank did signal that it may look to taper later this year. This in theory should help support the Euro going forward and there could be another wave of Euro strength in the not too distant future. Clients looking to buy Euros would be wise to consider securing funds before such action is offered.
There is a ray of hope for clients buying Euros in that the speech from Theresa May expected in about two weeks’ time could have a positive impact on the price of sterling. If the speech is received well there could be gains of 1-2% creating a good window of opportunity for those looking to purchase.
If you would like further information on sterling or Euro 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 [email protected]