The pound continues to defy the pressures of Brexit and steadily treads water in a tight range on a market that has stayed quiet as it emerges into 2018.
I’d imagine that we are far more likely to see erratic movements and periods of sustained volatility in the weeks and months to come, but thus far the best you would have got this year is around €1.1250 with the lowest €1.1130. Hardly good rates, but frankly it might set the tone in the months to come.
As we know Brexit has the scope to derail the UK economy, and pessimism continues with the outlook being anything but definitive.
This week, we saw the Prime Minister May announce a cabinet reshuffle, and Angela Merkel finally form a coalition in Germany. Focus, however, moved away from the women of the world and towards the man at the White House. President Trump has major ability to change the outlook of the financial markets internationally and he has once again shaken the tree this week and created division in the US. His mental state, his ability to lead, and keep world peace are all in question. We mustn’t think of the worse and certainly shouldn’t hope for it, but the pound might benefit from the dollar weakness.
More updates next week and if you’d like to discuss your transfer requirement, then please get in touch.
By Luke Trevail, Senior Currency Trader