Current Currency Climate: May OUT!Thursday, 13th June 2019
Guest blog by Ian Ledgerton, Currency Matters
The big news for the value of Pound sterling in May 2019 was the resignation of UK Prime Minister Theresa May, this has cast further uncertainty within the UK government and drastically increased the odds of the UK leaving the EU without a deal when the deadline passes at the end of October.
At the time of writing GBP/EUR is currently trading @1.1206 a steady decline throughout the month of May which saw the Currency Pair lose nearly 3% (2.82%) of its value against the single currency.
This was mirrored by Sterling’s performance against the US dollar, currently trading @1.2671 again a steady decline for the month of May, in which GBP lost 2.13% of its value against the USD dollar.
The focus now turns to the leadership race for the Conservative party and the next PM for the UK, as this is likely to be won by a Brexiteer, the likelihood of a No-Deal hard Brexit rises by the Day.
With Boris Johnson looking like the favourite to win the race for the hot seat, he stated at the end of May that the UK will be leaving the EU at the in October with a deal or without, GBP has therefore been falling day in day out, with little in the way of positive news for the UK and its position in Brexit Negotiations. Major Banks now fear that the Currency Pair could fall towards parity throughout the remainder of 2019 as uncertainty in the UK economy will increase.
During his State Visit President Trump offered some support for the UK by insisting the two countries will have a phenomenal trade deal after Brexit. This was about the only positive news for the Value of the Pound.
June 2019 Considerations:
- A new PM – and ultimately their view on Brexit!
- Economic Performance – The UK economy Shrank in April (Negative for GBP)
- Bank of England Super Thursday 20th June – Interest rate decision (likely to be unchanged)