Donald Trump undermines Theresa May

Donald Trump’s visit does not bode well or Theresa May. The ideal scenario would be for the US President to lend his support to May and put the UK to the front of the queue in a any trade deal.

President Trump stated he had given Theresa May instructions for Brexit which were ignored. He went on to say a softer Brexit deal means the US and the UK will not have a private trade deal as under the current proposal the UK would still essentially be part of the EU.

The recent resignation by David Davis and Boris Johnson could be timed for maximum damage in Brexit talks. A further two less senior Tories have also resigned this week.

If it is the case that Boris Johnson intends to make a leadership challenge and oust Theresa May, Sterling could be in trouble. One of the key factors in currency value is political stability. It doesn’t get much worse than a leadership challenge.

It seems it could well be on the cards as Trump also sated that his friend Boris Johnson would make a great PM.

There is very little reason to be optimistic about the pound at present. Especially against the US Dollar.

You would think I a country was involved in multiple trade wars the currency in question would weaken. This is not the case with the greenback however. In times of global economic uncertainty investors flood to safe haven currencies. With US 10yr treasury currently offering the best returns in years and the promise of several further rate hikes from the Federal Reserve the US Dollar is proving to be the destination of choice.

The only positive for Sterling at present is the fact that 1.30 is holding up as a resistance point.

If you would like any assistance with a currency transfer or would like more information about Pound to US Dollar exchange rates feel free to drop me an email at [email protected].

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