020 7898 0500Following on from Tuesday’s leg up for sterling (pound, GBP), Theresa May’s Brexit speech was examined with a fine tooth comb by economists and analysts. In the meantime there was positive news for the UK after it was revealed that unemployment fell to 1.6 million for the three months up to November. This is the lowest number in over a decade, with the unemployment rate remaining steady at 4.8 percent. In addition, average earnings for the same period increased by 2.7 percent. This is particularly important in relation to inflation and how this impacts the economy. Given the news on Brexit, it will be interesting to see if this trends continues.
Sterling was slightly weaker on the day as the market digested May’s comments, followed by the inevitable response from its European neighbours. Donald Tusk, the president of the European council, reiterated that the UK should not be allowed to maintain the advantages of single market membership, while rejecting free movement. However, much of the focus was on the comments from foreign secretary Boris Johnson, who stated: “if Mr Hollande wants to administer punishment beatings to anybody who seeks to escape, in the manner of some world war two movie”. This only highlights how strained current relations are between the UK and the European Union, and just how far off we are from any sort of agreement. Johnson’s comments have resulted in various senior figures in politics calling for his head.
Data is thin on the ground in the UK today, but further developments on Brexit could result in more price action.
