The Pound is still doing pretty well following the triggering of Article 50 last week. Now that the process has started, it's a classic case of 'sell the rumour, buy the fact'. Sterling had been weakened significantly during the last 9 months, and now that the Brexit process has started, investors seemingly decided that they would not punish the Pound further.
Sterling/Euro sits around the €1.17 mark which is around a 1 month high, and only a few percent below the best levels since the referendum. Sterling/Dollar also rose to around $1.25 before slipping away a little.
What could move exchange rates in the coming days?
With negotiations unlikely to start for a month or two, focus has now turned back to economic data, which is what normally moves the rate in the absence of any political surprises. The Pound's gains have been kept in check following slightly worse than expected Manufacturing and Production figures in the last few days. The next main news from Britain will be on Friday, when we see further Manufacturing numbers along with a GDP estimate and Trade Balance data. Manufacturing will be quite important, and markets expect a 0.3% gain. If it's higher or lower than this, expect Sterling to move accordingly.
For GBP/EUR rates in the next few days it will be data from Europe that is likely to move the rate, barring any surprise 'Brexit' news. There's a speech by ECB president Mario Draghi this afternoon, and any new information about monetary stimulus could move the single currency. Later this week we have German Trade balance data, and Services and Inflation numbers. The EU economy has actually been doing pretty well recently and if this trend continues, the Euro may strengthen and become more expensive to purchase.
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Labels: Best Exchange Rates, Brexit, Buying Euros, Currency Forecasts, Economic Data, Pound/Euro, Sterling Euro Forecast
