Pound marooned at 1.11 against the Euro
The pound to euro exchange rate has struggled to make any impressions over recent days, but with the UK’s new Prime Minister set to be announced later this morning, is this recent negative trend set to change?
Whilst no one can predict how the markets will react, those clients holding the pound will be hoping the pending appointment brings with it an upturn in fortunes for the pound, which has seen its value marooned just above 1.11 against the EUR during the early part of the trading week.
New UK Prime Minister: Could the reopening of Brexit negotiations benefit GBP/EUR exchange rates?
The markets are anticipating that the new PM will re-open Brexit negotiations on Friday, so investors will focus on any prospective developments, which could indicate a potential breakthrough. The current stalemate and prospective threat of the UK leaving the EU without a deal has hindered any substantial gains for GBP against the EUR over recent months, but whether the new PM can have a positive impact on proceedings is debatable.
Assuming that Boris Johnson, who is widely anticipated to take the reins over Jeremy Hunt, is announcement as the new PM later today, can we expect a clearer Brexit mandate and a harder line approach to Brexit talks?
EU possibility of compromise over the Irish back-stop promising
There are reports indicating that the EU may be willing to make some type of compromise over the Irish back-stop, which could help Boris Johnson to convince his fellow MP’s to vote in favour of a Brexit deal, which in essence may look every similar to that of former PM Theresa May’s.
With the current uncertainty around the UK’s final Brexit position unlikely to be resolved immediately however, the pound may find that any immediate support is unforthcoming, even with new PM and their potentially bullish stance.
If you interested in learning more about GBP/EUR rates and with a new UK PM announced today, feel free to contact me using the form below. I look forward to hearing from you.