Italian referendum and the impact for Sterling vs the Euro (Tom Holian)

Sterling Euro exchange rates broke briefly past 1.20 overnight on the Interbank level as predicted in some of my previous articles. Italian Prime Minister Matteo Renzi announced that he will be resigning following the ‘no’ vote in the Italian referendum aimed at reforming the constitution.

In the same way as David Cameron allowed the Brexit vote to happen Renzi authorised this vote to take place and it has ended up going against him forcing him to resign.

The Five Star movement who are aiming to hold their own referendum on EU membership are now likely to gain a bit of momentum and this could see a shift in the political feeling in France, Holland and Germany as they go to the polls next year.

Today, the Supreme Court will be looking at the government’s challenge to overrule the High Court in an attempt to ensure Article 50 will be triggered in March 2017 as planned by Prime Minister Theresa May.

However, the announcement about the ruling is not likely to come out until January 2017 so we could be in for a very uncertain December.

The European Central Bank are due to meet on Thursday and with inflation still running extremely low on the continent the ECB are struggling to combat this problem and could end up with the central bank announcing further Quantitative Easing measures on Thursday and if this happens this could also help push Sterling in an upwards direction against the Euro.

Generally speaking economic data in the UK has been relatively strong during 2016 and it is really only the uncertainty caused by the Brexit vote which continues to keep the pressure on Sterling exchange rates. However, as Europe appears to be destabilising politically recently then I think we may see further gains for the Pound towards the end of the year.

Having worked in the currency markets since 2003 I am confident that not only can I offer you better exchange rates than using your own bank but also help you with the timing of your transfer of funds.

If you have a currency transfer to make and want to save money on exchange rates then contact me directly for a free quote and I look forward to hearing from you.

Tom Holian [email protected]