Monday, 22 February 2016

Monday, 22 February 2016

EU referendum set for 23rd June

Last week saw both GBP/EUR and GBP/USD rates both move around 2% each between the highs and lows. GBP/EUR rates peaked at 1.2990 early in the week before falling to a low of 1.2760 on Thursday.

It seems that Sterling was the main reason for last week’s movements with the talks between David Cameron and the other heads of the EU member states creating a cloud of uncertainty over the pound. Sterling crosses were shifting with no data to back up the movements, with investors unsure which currency to put their funds in.

The pound has had a pretty torrid time recently and this uncertainty will not do anything to help. Even the strong retail data last week couldn’t do anything to bolster the pound with the markets just brushing the release aside to concentrate on what is going on in Brussels.

Last week’s movements just go to show that the markets move for a number of different reasons and whilst we have a very strong opinion on where we think they might go, any fresh rumour can instantly change the direction.

It came out over the weekend that David Cameron had reached a deal with the EU leaders which has now paved the way for a public referendum on 23rd June this year. This means we could have a very choppy four months ahead for Sterling and there are bound to be a number of opinion polls coming out that could influence the markets. Cameron’s deal was dealt a huge blow yesterday however when Mayor of London, Boris Johnson, stated that he will campaign to leave the EU. It is thought that Johnson could get a lot of backing with this so it is going to be a very interesting few months.

Foremost Currency Group can act as your eyes and ears on the markets to help you find the opportune timing to make the most of your currency. We have a number of different contract options to help safeguard your funds against adverse market movements. One of these being a Forward Contract whereby you can lock in an exchange rate for a future settlement date by simply placing a small margin against the trade.

If you would like to speak with one of our professional, knowledgeable currency specialist please get in touch for as free, no obligation consultation. Tel +44 (0)1442 892068 ask for Adam and quote ALFR/PE

image credit denzel @ pixabay
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