Is this a small window of opportunity for pound sellers? (Daniel Johnson)

Bank of England Announces Emergency 50bps Rate Cut

Brexit Progress

We have seen small gains for Sterling against the majority of major currencies following some progress in Brexit talks. Although the major issues are yet to be addressed such as citizen rights and trade. It has been decided that we will now move to phase two of talks which has been deemed as positive for Sterling and also moves us further away from the “no deal” situation which could be horrendous for the pound.

UK GDP data could cause volatility

UK GDP figures are released on Wednesday at 9.30am. This does have the power to influence the markets, figures are expected to arrive at 0.3%, no change from the previous month.  I think there is the possibility of a decline however due to recent negative data releases caused by the uncertainty surrounding Brexit. GDP could also influence monetary policy in regards to the upcoming interest rate decision on 2nd November.

BOE Interest Rate Decision

There is currently a 77% chance of a rate hike on 2nd November. This has been based on high inflation and the best unemployment figures since the 70’s. Inflation is only positive if average wage growth is growing at a similar pace, it currently is not at 2.1%. Unemployment data is skewed due to the recent addition of zero hour contracts which is far from a stable form of employment.

The market moves on rumour as well as fact so do not necessarily think there will be a huge spike in Sterling value if a rate occurs. The likely hood is that a hike is already factored into current exchange rates. The big shock would be if there was no hike, this could potentially cause a significant drop in Sterling value. It is important to remember that the most recent vote on interest rates from the MPC came in at 7-2 in favour of keeping rates on hold. Could we see such a significant shift just a month later?

If you have a currency requirement I will be happy to assist. It is crucial to be in touch with an experienced broker when the market is currently so hard to predict. If you let me know the details of your trade I will endeavour to produce a free trading strategy to suit your individual needs. Have faith knowing you will be dealing with a brokerage in business for over 16yrs, Foreign Currency Direct Plc. We are a no risk entity as we do not speculate on the market and we are registered with the FCA. If you have a currency provider take a minute to send over the rates they offer and I am confident I can demonstrate a significant saving. I can be contacted at dcj@currencies.co.uk . (Daniel Johnson) Thank you for reading.