Luke Trevail, a currency exchange specialist at forex brokers TorFX, looks at the factors driving the pound’s exchange rate this week.The rise of perceived ‘anti-establishment’ voting of 2016 could set the tone for 2017, with Brexit and Donald Trump of course taking all the headlines this year but the general elections of Germany and France next could easily follow the trend we’ve seen already. The ‘forgotten man finding his voice’ has been the rhetoric from both Trump and Brexiteers following the shock results. This notion gathering pace could easily shake European politics in the months to come.
Marine Le Pen, the leader of the National Front, was first to announce her candidacy for the French elections in April next year. Her immigration position and tighter border control has garnered her a lot of support in the early polls already and she’s publicly said that she would call a similar referendum that Britain saw in June to ensure that France has a greater say in the migrants that come into the country. She’s played on people’s emotions following the wave of terror attacks in recent years, and the idea of ‘Frexit’ isn’t perhaps too farfetched,
The worry that Europe are facing an uncertain few months has knocked the currency down against the pound this week. Sterling has enjoyed a good few days with unemployment data continuing to impress and retail sales figures being far better than expected.
Rates have touched €1.1730 in early trading on Friday, up heavily from a range around €1.08 in October. In relative terms, it makes it a fantastic time to move funds if you’re in a position to do so.
The appeal of the High Court ruling that MPs must vote of triggering Brexit will be heard in the Supreme Court on 5th December, the result of which is likely to be in the new year so this will likely move the market significantly. Depending on the result it could spike higher or plunge downwards in the short-term regardless of the pending elections on the continent.
As always, things remain unclear. We have no idea what tomorrow brings on these markets, but we’re all experts on what happened yesterday of course. Take it day by day but see the positives in the here and now. We’re far better than where we’ve been and that could save you a lot of money!
This article is written by a foreign-currency broker working for TorFX, a forex broker established in 2004 to provide foreign exchange and international payments to both individuals and companies. TorFX is authorised by the Financial Conduct Authority under the Payment Service Regulations 2009 for the provision of payment services. Their FCA number is 517320. To verify their authorisation, you can visit the Financial Services Register and search the register using their FCA number. SPI is not responsible for the opinions of guest contributors.