Sterling opened on the softer side this morning after Boris Johnson began to outline his views for Britain’s future outside of the European Union. After the formalities of Friday’s departure, the UK enters a new phase of the exit as the two sides now look to thrash out a deal for future trade.
Over the weekend, Boris Johnson was quoted as saying the UK would like a Canadian style trade deal, however, they would accept a trade deal similar to Australia if needs be. This potentially leans back towards a deal or no deal ultimatum and markets will be waiting for his speech later today, for clarification on his stance for when the trade talks formally kick off in March. At 10:00 GMT, the EU will be showcasing its objectives for the divorce deal.
Manufacturing data is released today from 9:30 GMT, with figures coming in from Europe, the UK, Canada and the US. The markets are predicting it is only the US which will see an improvement on their data release, however, it still will not be at the mark to give confidence to USD.
The coronavirus outbreak is still affecting global markets and dampening risk appetite. Safe haven currencies such as JPY and CHF are up across the board, with investors looking to mitigate their risk. Off the back of this, commodity currencies especially the AUD has taken the brunt of the impact, with GBP/AUD being the only pair currently on track to beat pre-2016 Brexit referendum figure.
Have a good day,
Author: Jack Nicholls, Relationship Manager
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