Pound euro exchange rate dips as post-Brexit nerves eclipse January’s UK retail sales hike

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Although retail vendings have improved along with overall British consumer aplomb, Senior Economist at Berenberg Kallum Pickering said this equipped little “evidence of strong gains to come throughout 2020” due to post-Brexit uncertainty. Samuel Vaults, the Chief UK Economist at Pantheon Macroeconomics, was more optimistic, saying that January’s retail sales outlines had confirmed that December’s general election had “released the handbrake” on the civil uncertainty that was holding back the British economy.  

However, Excellent continues to be restrained by concerns over post-Brexit trade negotiations between the UK and the EU after the UK’s Chief Brexit mediator David Frost said he was not seeking alignment with the bloc. 

Stefaan De Rynck, Higher- ranking Advisor to the Chief EU Brexit Negotiator, also added that craft talks between the two could get “rather difficult”. 

As a result, the pound to euro has remained moderated with concerns rising that the UK could face a no-deal prcis later on this year. 

The euro clawed back some of its privations despite today’s release of Germany’s GfK Consumer Confidence Survey, which displayed a stagnation in consumer sentiment. 

GfK’s consumer expert Rolf Bürkl elucidations on the data: “The consumer climate has been unable to continue the previous month’s practical trend. The spread of the coronavirus has undoubtedly contributed to uncertainty among consumers.”

“A degeneration or halt in production in companies in China triggered by the virus could select production in Germany as well, or even cause it to come to a complete halt.”

The single currency’s gains, however, are likely to remain short-lived due to wager surrounding next month’s European Central Bank (ECB) policy confluence. 

Looking ahead to tomorrow, we could see the pound to euro exchange chew out edge higher if the UK’s flash Markit Services PMI shows an uptick in February.

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