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Pound exchange rates slumped sharply at the start of the week after reports emerged that the government was not looking to maintain membership of the single market in negotiations with the EU. However, this downtrend was soon reversed when Theresa May set out her broad aims for Brexit in her first major speech on the [...]

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Hard Brexit Fears Weigh on Pound Rates

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Date: January 11th, 2017.

Comments from Theresa May saw the Pound plunge dramatically at the start of the week, with suffering from a resurgence in market fears of a hard Brexit. May’s statement that the government is not interested in keeping ‘bits’ of its EU membership led to speculation that privileged access to the single market is likely to [...]

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Both the UK Manufacturing and Construction PMIs for December markedly bettered forecasts, offering further evidence that the initial negative impact of the Brexit vote has faded. These latest signs of strength within the economy offered support to the Pound, although this positive data was not enough to entirely overshadow the latest political turmoil. Nevertheless, hopes [...]

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Limited Trade Volumes Encourage Pound Volatility

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Date: December 21st, 2016.

Unsurprisingly the Bank of England (BoE) opted to leave interest rates on hold at its final meeting of the year, offering little in the way of support for Sterling. The Monetary Policy Committee (MPC) unexpectedly lowered its inflation forecasts for 2017, noting that the Pound has recovered significantly from its post-referendum lows. While this might [...]

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Reaction to the Supreme Court hearing of the government’s Article 50 appeal has been relatively limited given that the verdict will not be known for some time yet. Even so, Brexit-based speculation helped to drive the Pound higher thanks to ongoing speculation that the UK could pay to maintain its privileged access to the single [...]

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A page of leaked government notes on Brexit failed to do much to weigh down the Pound, despite these appearing to point towards the UK losing its access to the single market. Investors were more inclined to focus on positive consumer credit and mortgage approvals figures, which together suggested that the domestic economy remains robust [...]

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Comments from Theresa May to the CBI conference helped to boost the Pound this week, as the prospect of the ‘Brexit cliff edge’ was diminished. May’s promise of a transition deal encouraged investors, pushing Sterling higher across the board as some shred of uncertainty was removed. Even so, with no surprises expected from the second [...]

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Despite a Donald Trump presidency being seen to improve the chances of a fast-tracked US-UK trade deal, worries over the Brexit issue have continued putting pressure on the Pound. Markets were spooked by a circulated memo which claimed the government has ‘no plan’ on the matter, a prospect which naturally bodes ill for the domestic [...]

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Demand for the Pound was also limited by a more modest NIESR Gross Domestic Product estimate for the three months to October, which indicated a slight slowing of growth. Market uncertainty stemming from the result of the US election is likely to limit the appeal of Sterling in the near term, though, with a Trump [...]

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The Pound experienced some major volatility at the start of the week, thanks to speculation over the future of Bank of England (BoE) Governor Mark Carney. Although there was some relief amongst investors when Carney was revealed to have extended his term until June 2019 Sterling soon returned to a downtrend. While there are no [...]

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