It’s been a rollercoaster ride for the Pound today. Taking GBP/EUR as an example, we have seen rates between €1.1440 and €1.1540, and right now we’re right at the bottom of that range.
The reason the Pound has fallen is that Theresa May will not now make a statement about Brexit. To me this indicates that the Cabinet are not in agreement. All afternoon May has been trying to sell the plan to the cabinet, but it does not appear to be going well.
It’s mostly all speculation at the moment and there are no hard facts. That’s why Sterling has been all over the place today, reacting to any snippets of news. We might here from May later tonight but I think it’s more likely we’ll see a statement in the commons tomorrow.
Perhaps she will make a statement once the cabinet meeting has finished, at the moment we’re hearing conflicted reports, and all day the markets have been trying to second guess what will happen, and that’s caused quite a bit of volatility for the Pound.
In terms of what this means for the Pound, nothing has changed. If the deal is agreed, expect the Pound to rise. If the cabinet do not agree, expect the Pound to plummet. In the meantime, GBP/EUR is likely to continue bouncing in its range between €1.1450 and €1.1550.
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