The Pound has dropped across the board of major currency pairs today, and significantly fallen below 1.11 against the Euro this afternoon.
The UK Government is stepping up its plans for a no-deal Brexit, and today it’s begun the process of releasing documents that outline the Government’s contingency plans in the event of there being no deal/arrangements in place once the UK leaves the European Union. There are now less than 7-months remaining until the will leave, and analysts are outlining November as to when they expect an agreement to be in place. The expectation was previously for October but this has since been delayed, and this week there have been talks between the UK and EU leaders regarding the terms of the UK’s divorce from the EU.
The Pound has lost over 11% against the US Dollar owing to the fears surrounding Brexit along with a bullish US economy. The Pound is also trading at its lowest level of 2018 against the Euro and this demonstrates the effects this uncertainty is having on the Pound’s value.
Economic data is light this week and next week is expected to be quiet also, so the chances are that politics will continue to drive the Pound’s value for the remainder of the month.
Those of our readers planning on making a currency transfer involving GBP should consider that since the vote Sterling has traded at lower levels, so there is a chance that the Pound could fall further.
Ever since Dr Liam Fox, the secretary of state issued a warning suggesting a 60% chance of a no-deal, Sterling exchange rates have gradually declined owing to the reality of the situation kicking in.
On the other hand if some of our readers are planning on converting another currency into Pounds, the biggest potential downside would be a breakthrough in the negotiations, and I would expect to see Sterling rise dramatically in the event of this, especially as the UK economy has shown signs of resilience recently. There was also an interest rate hike from the Bank of England this month which under usual circumstances would result in a boost to Sterling’s value.
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