Brexit and Article 50 to dictate Sterling Euro movements (Tom Holian)

Since the US election we have seen the Pound make some solid gains vs the Euro owing to Trump’s stance in the run up to the Brexit as he was a huge advocate of the vote to leave the European Union.

Previously, Obama had stated that the UK would likely go to the ‘back of the line’ in terms of trade agreements but as Trump has close ties with the UK it is likely that any potential trade agreement could be prioritised for the UK.

Sterling exchange rates have so far had a mixed week with a leaked memo suggesting that the UK would need to employ another 30,000 additional civil servants as and when Brexit happens. However, the government has come out and ‘wholeheartedly’ removed themselves from the report which helped Sterling to recover its brief losses.

The problem for Sterling Euro exchange rates is that the UK is still facing a period of huge uncertainty politically and with Theresa May due to visit Angela Merkel on Friday if the talks go well we could see Sterling make some gains vs the single currency. Good news if you’re looking to send money to Europe.

There are a number of problems on the continent with the ongoing Greek crisis, the considerable amounts of bad loans for the Italian banks as well as the ongoing problems for low inflation.

Therefore, there are clearly big problems in Europe but until we are more settled politically expect the volatility between Sterling and Euro to continue.

If you’re concerned about what is happening with exchange rates and need to make a payment before the end of the year then it may be worth looking at buying a forward contract which allows you to fix an exchange rate for a future date.

Having worked in the foreign exchange markets since 2003 I am confident not only of being able to offer you better exchange rates than using your own bank but also to help you with the timing of your transfer.

To find out more information or for a free quote when buying or selling Euros then contact me directly and I look forward to hearing from you.

Tom Holian

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