Boris Johnson vs Jeremy Hunt: What was their stance on Brexit?
The euro is now trading close to its best level to buy pounds since the start of the year. The pound is facing huge pressure against a number of different currencies owing to the effect of the Brexit uncertainty as well as the Tory leadership challenge.
Last night the two leadership candidates went head to head in a live televised debate. Jeremy Hunt accused Boris of ‘peddling optimism’ and claimed that the only important issue to Boris is to get into Number 10. In retaliation Boris claimed that Hunt was unclear on when the UK should leave the EU. He also went on to ask ‘How about Christmas? Any good?’ Clearly at the end both candidates claimed victory. The next debate will take place on Friday with the final vote due on 23rd July.
The real problem for sterling is that whoever wins the election may not provide that much support for the pound. The main issue for sterling exchange rates is that of Brexit. Until we get some form of clarity I think the pound will continue to struggle. Therefore, if you’re buying euros it may be worth getting things organised in the near future.
Problems for growth in the UK: Is a recession looming?
In the meantime, the Bank of England has predicted that quarter two growth may have stagnated. Quarter one was clearly influenced by the stockpiling of goods prior to the original Brexit deadline.
Therefore, the figures were not a true reflection of the economy during the time. If we continue to see a slowdown in growth this could push us closer to a recession. This could cause further problems for sterling against a number of different currencies including vs the euro.
With just less than two weeks before we have a new Tory leader expect GBP/EUR exchange rates to remain volatile. If you’re in the process of buying a property in Europe in the weeks ahead it may be worth buying a forward contract, which allows you to secure an exchange rate for a future date.
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