The pound has continued its rival against the Swiss Franc after seeing a low at 1.1090, the pound has recovered to 1.1880. As the spread of Covid-19 has taken over the world and increasingly dominating headlines for the first part of 2020, it has been the first major topic to overshadow the Brexit story much talked about for the last 4 years in Europe but particularly the UK. With the coronavirus putting the world on lock down it had been feared that with trade negotiations due to be concluded this year ahead of the final exit point in December, this could be disrupted and increasing the chances of the UK leaving the EU with a No Deal. This has always being deemed as the worst case scenario for the UK and with a deep recession now almost a certainty it only makes for a more bleak outlook for the UK.
James Slack, a spokesman for the Prime Minister, who said that post-Brexit EU trade talks were still continuing by telephone, only last week officials in the European Union has said that post Brexit trade talks had been side-lined indefinitely, which had been priced in the sterling’s value which helped keep the rate low. This announcement that talks were in fact still ongoing despite the pandemic helped give the pound further support on Monday which followed a positive end last weeks gains by the pound against the Swiss Franc. Boris Johnson has previously stated that talks need to be well advanced with EU by June otherwise his team would walk away and prepare for a no deal Brexit in December.
The Swiss Franc has long been a currency to see considerable gains when uncertainty surrounds the markets, with the CHF hitting records high against the pound amongst many other currency pairs the Swiss National Bank has started to intervene directly in the FX markets, by selling CHF to buy other currencies in order to push the down the value of the Swiss Franc.
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