The pound is losing ground this morning after a good rally this week. News this morning that Maltese Prime Minister Joseph Muscat has given a firm statement that Britain is not to receive a good deal after invoking Article 50 is a reminder for the markets that there is a sizable task ahead of Britain with these Brexit negotiations which are to commence in 2017. GBP EUR is currently down 0.6% this morning and falling sharply.
UK GDP numbers are released this morning at 09:30. To date GDP has help up very well and in my view I would be surprised if we see anything out of the ordinary. A steady figure at 0.5% for the third quarter would be welcome news and should support sterling exchange rates although anything higher could see a rally for the pound. US non farm pay roll numbers are released this afternoon and this too could have an impact on the Euro.
As far as the Euro is concerned we are now fast approaching the Italian referendum on constitutional reform which is being held one week Sunday. This has the potential to be a major market mover and is eagerly awaited as there are many different outcomes that could arise following the referendum result.
Clients who are holding sterling are seeing some much better times for buying Euros which has largely come about following the Trump election victory. We do appear to have now hit the peak for GBP EUR with a wobble at the top this morning.
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