GBP EUR Rates before EU Summit

The pound should be in for a volatile couple of days with Theresa May flying to Brussels today to meet the other 27 European leaders at this summit. It will be decided officially if sufficient progress has been made for talks to move on to the second phase in the negotiations and the outcome should have a sizeable impact on the price of GBP EUR.

If the mood is positive from both the UK and EU side then this is likely to have a positive impact on sterling exchange rates. A move back over 1.15 for GBP EUR seems entirely plausible and could present some good opportunities for those clients looking to buy Euros. Those clients looking at selling Euros for pounds would be wise to consider securing a rate prior to any announcements as the odds would suggest that an agreement will be reached.

Theresa May goes to Brussels today having lost a key vote in the House of Commons last night which allows parliament to now have vote on the final deal offered by the EU and some would argue it weakens her hand in these important negotiations. This could cause problems further down the line in government as well as delays in delivering Brexit and in my view this is likley to create additional uncertainty for sterling exchange rates going forward. A key vote next week on the setting of a date for Brexit enshrining it into law will be crucial and if the government was to lose this vote then the pound could come under additional pressure. The Bank of England and European Central Bank interest rate decisions today are also likely to create more volatility for GBP EUR.

Today and tomorrow could see major market movement on the back of the summit so to discuss how your individual currency requirement is likely to be impacted by these events then please feel free to get in touch with me at jll@currencies.co.uk

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