020 7898 0500Yesterday Sterling first fell to its lowest level since the infamous “flash crash” in October and then recovered somewhat when May’s spokesperson stated that reports about the planned tone of her Brexit speech were “speculation”.
The long-awaited Brexit speech by the Prime Minister is scheduled for today. Markets fear that May will lay out a framework for a hard Brexit. Should May confirm that the government will prioritise border control over single market access, sterling could hit new lows. The question remains how much of the decline is now already priced in, following May’s and Chancellor Philip Hammond’s comments at the weekend.
However, the speech could go either way of course and so could sterling.
More volatility is expected when the Supreme Court announces who will be in a position to trigger Article 50, the government or parliament. The announcement may be made as early as tomorrow.
Sterling will continue to react to Brexit rumours and updates. Some of the currency moves are quite significant when you’re sending larger amounts abroad, for example, and this is definitely a good time to consider locking in exchange rates.
We shouldn’t forget that this morning the UK will also announce the latest inflation data, which is expected to push higher towards 1.4%. Still well the target of 2% but certainly moving strongly in that direction.
