The Pound is close to its lowest level all year as we are now just three months away from the deadline when the UK is due to officially leave the European Union.
The latest key date will come in the next fortnight when MPs will meet once again to vote on the current Brexit deal.
Earlier this month the vote was postponed after it emerged that Theresa May clearly didn’t have enough support to get the Brexit deal through and since then she has tried to lobby the EU to make some amendments to the deal on offer.
Could the UK stay in the European Union?
What has emerged during the course of this month is that there is clearly a lot of support in favour of remaining in the European Union. At the moment MPs have made it clear that they are in favour of staying in the EU. The EU clearly wants to make things difficult for the UK to leave and indeed it could be argued that as Theresa May previously voted to remain, is the plan to keep challenging the deal until we get towards the end of March?
The European Court of Justice has said on a number of occasions that the UK will be allowed to revoke Article 50 until the end of the two year period which ends in March 2019 so if we face the prospect of a no deal could the UK revoke Article 50?
Theresa May has committed to lead us through Brexit but if she is unable to get the Brexit deal through parliament I think she could end up stepping down as she will not be able to complete her mandate, so could we see another leader by Spring 2019 or indeed a general election coming by then?
What’s next for Pound vs Euro rates?
There is a lot of uncertainty over the next few months and this has caused the Pound to remain under pressure. The future of Pound vs Euro rates will be heavily reliant on how the first quarter of 2019 goes in terms of the Brexit discussions.
In the short term I think we could briefly dip below 1.10 on Pound vs Euro exchange rates, but I think the losses will be limited as GBP/EUR has remained between 1.10-1.15.
Indeed, during this year the foreign exchange markets still appear to be adopting a wait and see approach as to what may happen when or if the Brexit does take place. My current suspicion is that we could either see a second referendum or Article 50 revoked.
Whatever happens I expect a very volatile next three months for the Pound vs Euro so it may be worth getting your currency organised in the short term to avoid the heightened risks of what may happen.
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