In this Sterling Euro forecast, we’ll look at how Pound to Euro exchange rates have been falling week-by-week since the start of the Summer, and mid-market exchange rates have dropped by 10 cents.
This week, former Chancellor Philip Hammond has taken to the press to warn that it would be a betrayal to the British people, if the UK ends up crashing out of the EU without a deal. In addition, the ex-Chancellor has gone one step further and taken a dig at Prime Minister Boris Johnson, for allowing “unelected people” to take control and push for a ‘no deal’ Brexit.
Regardless of who is in charge at No. 10, the same problems continue to surface. There is a split in Parliament of whether the UK should soften its stance to get a deal over the line or crash out with ‘no deal’. The cracks in government appear to be widening and September is set to be a rollercoaster month for UK politicians. Will there be a vote of ‘no confidence’ against Boris Johnson and will Tory MPs support it?
Should I wait to buy Euros?
Over the last couple of weeks, the Governor of the Bank of England, Mark Carney, has warned the UK government that a ‘no deal’ Brexit would put further pressure on the Pound. Consequently, it would make purchasing Euros more expensive.
Forecasters are suggesting that GBPEUR could reach parity, and I expect that, if the UK crashes out of the EU without a deal, then there is a strong chance that this will materialise. However, I still believe there is more chance of the UK and EU extending Article 50 once more, and triggering a UK general election.
If you are buying Euros short term, I find it difficult to see how the Pound is going to recover, until further clarity is provided. However, history tells us that the Brexit negotiations will go to the wire. Therefore, if you are buying Euros before the 31st October, there is a strong argument to buy your Euros up front.
If you are purchasing currency and would like to compare rates, fell free to email me directly [email protected], Dayle Littlejohn.