All national newspapers this morning have criticized speaker John Bercow’s ruling that Theresa May cannot bring back the same Brexit deal for a third vote unless there are substantial changes. The Times have even stated they believe Bercow is ‘Sabotaging May’s Brexit deal’ and Downing street are once again questioning the speakers impartiality.
Will Brexit be delayed?
It appears that now there won’t be a third vote before the EU summit on Thursday, therefore the Prime Minister will have to ask for a longer extension. The likelihood is that the EU will grant a long extension which could be potentially 2 years and there will be a minor concession which will allow a meaningful vote next week.
Members of Parliament that voted against Theresa May in the last 2 meaningful votes will have to ask themselves the question of whether they want an extension of 2 years. This opens the door to another referendum or vote in favour of the PMs deal to make sure the UK leave the EU in the upcoming months.
Pound to Dollar rates likely to be heavily influenced by Brexit updates
Pound to Dollar exchange rates have been heavily influenced by the ongoing Brexit saga over the last couple of years and I expect we could see further volatility in the upcoming weeks. Personally I don’t see the UK leaving with no deal now and a long extension is the most likely outcome. Therefore I forecast that GBP/USD exchange rates will remain range bound in the lower 1.30s for the upcoming months.
Selling US Dollars to buy Pounds
However for clients that are selling US dollars to buy pounds, if a deal is reached in the upcoming weeks I expect the pound to gain significant value. Over the last 10 years GBP/USD exchange rates have been as low as 1.20 but as high as 1.70. With exchange rates now in the 1.30s rates are still extremely attractive for buying sterling, therefore considering any short term GBP/USD transfers seems wise. For more information on Brexit and how the next couple of weeks could impact your transfer feel free to get in contact with me.
Economic data due this week
In other news, this morning average earnings and unemployment number are released for the UK. The numbers are set to remain steady at 3.4% and 4% respectively. Furthermore tomorrow the Federal Reserve are set to release their latest interest rate decision alongside the monetary policy statement. For more information on the data releases and how they could impact your currency exchange please feel the form in below and I will be in touch shortly.