It was the same story for GBP traders yesterday, with losses across the board against major currencies. Sterling saw a near 0.8% drop against the common currency, the euro, and a near 1% drop against the US dollar. Worrying signs for GBP traders as for what is potentially to come, as today we enter into the eighth round of trade negotiations with Europe.
The schedule for today kicks off this afternoon with a “level playing field for open and fair competition” being discussed. A number of topics will be covered including the contentious subjects of “law enforcement and judicial cooperation” and “fisheries”. Both of the latter two topics have been heavy sticking points in the negotiations so far, and also the cornerstone of the Vote Leave’s campaign in 2016. The negotiations are due to wrap up at around 18:00 BST, with any comments likely to leak after that time. Remarks were made this morning by UK housing secretary, Robert Jenrick, who announced, “If the European Union (EU) is not flexible, we will leave with Australia-style deal” before moving to confirm the UK’s position on wanting a Canadian style agreement.
At 10:00 am BST, Europe release their GDP figures as a collective. Analysts will be keeping a keen eye on the Q2 release to assess the health of the European economy. Should the figures come in better than expected, the GBPEUR exchange rate could fall below 1.11.
Further weighing on the UK economy is the steady growth in Covid cases being reported. England’s deputy chief medical officer, Prof Jonathan Van Tam, has said that the population is too relaxed and that the virus has not gone for good.
Have a great day.
Author: Jack Nicholls, Relationship Manager
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