Pound v euro: Sterling near 7-year low as full Brexit’ is confirmed
GETTY - STOCK The pound hit a fresh low against the euro today after falling last week
GBP’s unsettled start to the week has come as the Brexit process rumbles on. In the latest development, Liam Fox and Philip Hammond have jointly stated that the UK will definitively leave the EU in 2019. The news is widely seen as a show of unity between Fox, the Trade Secretary, and Hammond, the Chancellor.
Both ministers have stated that there will be a transitional period at the end of Brexit, but that once it is over, the UK will be conclusively ‘out’. On the other side of the pairing, the euro has only made marginal gains due to disappointing Eurozone data. Industrial production slowed by more than forecast in June, dropping -0.6 per cent on the month (rather than the -0.5 per cent expected) and easing from 3.9 per cent to 2.6 per cent on the year.
Brexit transition phase: Cabinet splits three ways Thu, August 10, 2017 Who is pushing for the most gradual departure possible from the EU? And who favours a cleaner break? Play slideshow AFP/Getty Images 1 of 15 HARD BREXIT: Andrea Leadsom
While today has brought little UK data, we could see high pound volatility over the next couple of days as a result of domestic data releases. The first of these announcements will be the UK’s inflation figure for July. No monthly change is expected, but an annual increase in price pressures is projected. Higher inflation would usually raise the chances of a Bank of England (BoE) interest rate hike, but so far the BoE has resisted caving to the pressure. This is partly because raising interest rates at the current time could worsen the situation for those with high levels of debt.
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GETTY Liam Fox and Philip Hammond have jointly stated the UK will leave the EU in 2019