Agreement on Brexit bill could cause Sterling Rally (Daniel Johnson)

Pound to Canadian Dollar forecast Brexit remains in Limbo

Brexit Bill has the potential to strengthen the Pound

It seems Theresa May is finally getting to the point where the UK is about to agree on a price to leave the EU. I believe Brussels have deliberately played hard ball in order to scare off any other region from departing the EU, shooting themselves in the foot. To me , it beggars belief it has taken over a year for a bill to be agreed. Trade relations are yet to start.

Theresa May has put €20bn on the table and following discussions with President of the European Council, Donald Tusk it is rumored that will be upped to €38bn. Now, considering the market moves on rumour as well as fact and Sterling has seen no significant spikes, either the bill agreement is far from nailed on or we will have very little impact on rates.

Personally, I think the agreement of a bill is big news as this paves the way for the talks to begin on the real issues with Brexit, freedom of movement for people and trade talks. I think if a bill is accepted Sterling could well rally.

Keep in mind however the UK is in a very unstable position at present. Following the Budget last week the UK growth forecast has been downgraded. The UK is now expected to be £42bn worse off in 2022 than expected previously. The UK’s leading financial think tank, the Institute of Fiscal Studies (IFS) has said they expect there to be up to twenty years of falls in earnings growth and  a longer period of austerity. Forecasts for earnings, growth and productivity have been cut substantially.

IFS Predictions

  • GDP per person will be 3.5% less in 2021 than 2016’s previous forecast.
  • There will be a spending increase over the next five years for the NHS, but it will be facing its tightest funding constraints since the 1980s.
  • Average earnings are predicted to be £1,400 a year lower in 2021 than what was forecast in 2016.
  • Borrowing will be £12bn higher in 2021 than previously forecast.

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.