Good morning,

A strong end to the week for the pound has since settled down to a more modest uplift, as the expected initial wide swings from the General Election outcome have found levels of sustainability to build on.

GBPEUR drives on above 1.20, whilst GBPUSD has found comfort in the high 1.33 area. The resolve from not initiating new tariffs from the US this weekend also provided the USD with some pushback strength.

With two global risk events leading to a somewhat positive direction in the interim this past week, we have seen the general outlook of the global economy gladly lean to risk-off, allowing for a supportive move of funds into the more riskier assets to end the year, with emerging market currencies eyeing up 2020 for a positive run potential.

The focus can now be shared on US/China ongoing trade discussions, as a phase one deal was reached on Friday, and now we await the official signing and formalisation of this and look towards a phase two. This will likely be a more difficult goal to establish, with a US presidential election to take into account as well

The week ahead will likely prove quieter in the lead up to Christmas, presenting an opportunity for any final trades for the year, as the pound sits in a window of elevated optimism with lower levels of volatility, something that can’t be promised come January.

Have a great week.

Author: Ross Hammond, Senior Corporate Account Manager