POUND LIVE: Pound could surge after Theresa May’s Brexit Florence speech

0

Pound exchange rate Theresa May FlorenceGETTY

The pen is on edge ahed of Theresa May’s Brexit speech

Sterling was flat at 1.134 against the euro and 1.349 against the US dollar on Thursday, as exchanges await the crucial Brexit update from Theresa May in Florence on Friday.

If the Prime Ecclesiastic weighs in towards a softer Brexit, the pound could push merry, experts forecast. 

But if Mrs May signals tough talk over the UK’s exit from the European Harmony (EU), sterling could take a hit.

Ahead of the speech in Italy, bumper retail jumble sales data in August has helped push the pound up, as further evidence that the control remains in robust shape. 

The likelihood that Mark Carney and the Bank of England’s Capital Policy Committee (MPC) will raise interest rates in November leftovers strong after sale jumped by one per cent last month.

Ruth Gregory, UK economist at Super Economics, said: «A modest pick-up in household spending should keep from the economy to re-accelerate a little ahead and adds weight to our view that the MPC resolve hike interest rates in November.»

pound to euro rate chart brexit GETTY

The pummel jumped ahead of Theresa May’s Brexit speech

Michael Hewson, chief make available analyst at CMC Markets, said: «The pound has managed to hold onto sundry of the gains of the last few days in the wake of last week’s surprise Bank of England upon face on the prospects for a UK rate rise, though governor Mark Carney did try his choicest to paint a rather bleak picture for the UK economy in his speech to the IMF on Monday.

«The bray has also managed to shrug off any concerns about the political chicanery at the top of the UK regime ahead of Prime Minister Theresa May’s landmark speech in Florence later this week.»

Brokers are now waiting for Mrs May’s all-important Brexit speech.

The tone of the Prime Minister and the block out of a Brexit plan will be the key focus for traders.

Kathleen Brooks, up on director at City Index, said «Theresa May’s Brexit speech in Florence on Friday is her inadvertent to shift the Brexit debate to a more sterling-friendly tone, it is also the from the start time we have heard the PM talk about Brexit in a meaningful way since she triggered Article 50 in Walk.

«However, she will have to deliver two key points before her speech can be seen as developing a “soft” Brexit and thus help to boost the pound.

«Firstly, she requirement lay out the government’s plan for a healthy transition period that will see the UK unused in the single market and customs union for a number of years after we split the EU in March 2019.

«Secondly, the tone of her speech will be critical.

«One can expect her to reach out a give in of friendship to get the negotiations onto a more cordial track, her choice of Florence to give up the speech may be a concession to the Europeans.

«Of course, if Theresa May’s speech backfires, first if she doesn’t lay out in detail her vision for the UK’s position after Brexit, then the parlance would be seen as a failure and the pound could be at risk.»

Leave a Reply

Your email address will not be published. Required fields are marked *