Rates for pound vs Euro await the most eagerly anticipated week in British politics ahead of the important meaningful vote to be held in Parliament tomorrow. Pound vs Euro rates climbed higher on Friday as the markets began to factor in the prospect of Article 50 being delayed amidst the deadlock in Parliament. Downing Street has however ruled out any extension of Article 50 which has stopped that rally dead in its tracks.
The House of Commons will vote on Tuesday on whether to support the Prime Minister’s Brexit deal or not. As things stand it appears that the deal will be voted down in Parliament which adds another layer of uncertainty for the pound.
Pound vs Euro Rates: The path for Brexit remains unclear
After a series of Government amendments last week including a controversial alteration from Dominic Grieve, there have been rumours that a coup may take place on Tuesday when the Prime Minster loses the vote. This was reported in the Sunday Times over the weekend which follows the Speakers break from precedent last week after allowing a controversial amendment to be voted on. Depending on the tactics of the Labour party and other politicians there is likely to be considerable market movement for Pound vs Euro this week.
The path of Brexit is now looking extremely unclear with so many differing opinions on Brexit and a last minute push by some to try and stop it. Theresa May will have just three days to come back to Parliament, assuming she loses the vote, to put forward a Plan B, something that has not been discussed openly to date. Those who are looking to buy or sell Euros are expected to see a highly volatile week as these outcomes will have a big bearing on the future direction of GBP to EUR exchange rates.
Weak economic data affecting the Euro
The Euro also finds itself with a gloomy outlook after weak economic data from Germany, Spain and Italy. It is starting to look conceivable that some of the biggest EU economies may fallen into a technical recession (two quarters of negative growth) which doesn’t bode well for Euro vs pound rates. It is not just the economic data which is reducing confidence in the Euro but also the political instability. This weekend there were more protests in Paris from the well mobilised yellow vests against French President Emmanuel Macron and his policies since gaining power.
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