Sterling continues to slide as ‘no deal’ concerns remain

Sterling continues to slide as no deal concerns remain

Pound vs euro remains under pressure since the resignation of Prime Minister Theresa May and we now have a number of members of the Conservative Party jostling for position as they battle to become the next leader.

Currently there are 13 members of the Conservative Party that have put themselves forward and it is sure to be an interesting few weeks. We are already seeing the media full of premeditated pictures of the candidates posing whilst out jogging, out on the streets and relaxing with their families showing what great character they have.

Pound to euro forecast

The reason that sterling is finding life a little tough is that a number of the contenders for the position have been quick to confirm that they will be looking to go forward with Brexit even if that results in a ‘no deal’ Brexit so this has now effectively been brought back to the table.

A ‘no deal’ Brexit or even the possibility of it causes major economic concerns and a lot of uncertainty, for those of you that have stocks and shares you may well have seen that share prices have been dropping away and the pound has also followed suit. The euro is now trading at the best levels against the pound since January and I feel GBP/EUR rates will only bounce back after some Brexit clarity.

Investors and speculators will most likely now steer clear of the UK and sterling until there is a little more clarity as to what the future plans are, much like you would not invest in a business if there was no clear business plan.

Will the pound strengthen in June?

I personally struggle to see any vast improvements in the pound until we have the outcome of the Conservative Party leadership contest and what the proposals of the new leader are, but we are in a new month, so economic data will also start to come through thick and fast over the next two weeks.

Recent economic data has started to show that the uncertainty surrounding Brexit has started to cause productivity a bit of a headache, but unemployment levels have remained very good.

Manufacturing, services and production figures are all out over the course of this week and they will most likely set the tone for the rest of the month. keep checking back here at Pound Sterling Forecast for how these data sets have impacted the pound.

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