GBP to Euro Forecast – Brexit Secretary Dominic Raab Resigns

The pound has come off its recent high against the Euro despite a draft withdrawal agreement being reached between the UK and EU. As of this morning the Brexit Secretary Dominic Rabb has resigned from his role stating he is unable to support the terms proposed for the deal with the EU. The pound has fallen sharply lower as a result with rates for GBP EUR down at 1.1370 and continuing to fall. Rates for pound vs Euro have already fallen by 1% on the back of the breaking news. This is the second Brexit secretary to now resign following David Davis and does not bode well for confidence in this deal.

Speculation is now mounting on whether there will be a leadership challenge in the Conservative Party. With so many politicians unhappy with this deal as it stands the number of letters being written to trigger a vote of no confidence in the Prime Minister are expected to go up in the days to come. A total of 48 letters are required to trigger a vote of no confidence, something which could see a material shift in government which would likely result in further weakness in pound to Euro exchange rates.

The deal which was announced yesterday has the backing of the cabinet although it has come under fierce criticism from Euro sceptic politicians as well as the Labour party. Prime Minister Theresa May will take the deal to the House of Commons today where it will come under scrutiny to establish what the implications are of signing such a deal. The Democratic Unionist Party which prop up the government will be a key part to this as they provide votes that Theresa May relies on to implement policy. The impact on Northern Ireland also needs to be established but the response so far has not been receptive and there has already been one resignation this morning from Shailesh Vara. Expect major volatility in these coming days as tensions rise in these final stages of this Brexit negotiation.

UK retail sales data is released this morning although Brexit will almost certainly overshadow this economic release. To discuss how the breaking news in these coming days will impact on your own transfer then please feel free to get in touch with me. I can help you with any transfers you may need to make either buying or selling Euros.

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