020 7898 0500The pound fell sharply against the US dollar and euro yesterday as EU Chief Negotiator Michel Barnier stated that the lack of progress in Brexit negotiations is ‘very disturbing’. When we consider just how long these talks have been going on, it is still pretty amazing that nothing has been decided. Despite the UK government’s protestations, it appears that until a divorce bill has been agreed, no discussions on future relations can take place.
Fears of an impending interest rate rise have led to a slowing of the UK’s housing markets. According to a recent report by the Royal Institute of Chartered Surveyors, sales and inquiries from people interested in purchasing property significantly dropped in September. The question is whether this, along with the increase in UK households defaulting on their debts, will give the Bank of England food for thought, or whether they will press on with their supposed determination to increase rates when they meet in November.
Today is a quiet one for UK economic data, although further developments(!) regarding how the Brexit negotiations are going could cause more sterling volatility. Despite yesterday’s weakening, the pound could have tumbled much further had the update on (a lack of) progress been more surprising.
