Sterling exchange rates have continued to surge higher with rates for GBP EUR breaking over 1.17. Retail sales numbers released yesterday were the best on record for 14 years which has helped drive the pound higher across the board. This is most welcome news and has provided the UK with a much needed boost when there is a lot of doom and gloom kicking around. There has been concern over the large budget deficit that Britain has accumulated which will become more and more topical. As such this rally for the pound is likely to be more short term rather than sustainable.
Will the Pound Continue to Strengthen?
Next week sees the Autumn statement from Chancellor of the Exchequer Philip Hammond on Wednesday. This has the potential to be a big market mover and the statement is likely to come under much scrutiny in this post Brexit climate. I struggle to see how the statement can be positive considering recent reports suggesting there is a black hole in the public finances that is in the billions of pounds. This may be where the pound ends its recent rally. Those clients who are looking to buy Euros would be wise to consider moving ahead of this date to potentially avoid disappointment.
Clients who are holding sterling and looking to buy Euros are seeing some much better times after all the Brexit uncertainty. There may be a little bit further to go for the pound although there will inevitably be more problems surrounding Brexit and the Statement next week could be the next concern.
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