Thursday, 19 October 2017
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Weekly Financial Update

The markets will be driven by much event risk this week. This, especially applies to sterling, where BREXIT EXIT talks continue with the possibility of progress or the possibility of no progress. Or, even the possibility of both depending on what they talk about. This will continue throughout the discussions, and the UK wants to get out, naturally as cheaply as they can, and the EU wants them to pay a higher ransom!! On top of this the UK Government seems to have some infighting and varying opinions on the BREXIT outcome, which only adds to the uncertainty.

On top of this we have some Central Bank speeches and the inflation figure. This alone could signal a rise in UK interest rates as early as November. This could be good for the pound but we feel to a certain extent this is already priced in. However, all these scenarios will for sure make the markets pretty volatile. This week we feel STG/USD will be the leader for the pound and will drag STG/EUR the direction it goes.

There is still no doubt that Sterling is weak and could well become weaker. Its just the timing that is hard to determine. There is so much uncertainty in the markets mainly because of the UK situation, that we could have some quite sharp moves in the coming months. This week may be one to watch from the side-lines and see what materialises. There could also be a few surprises that catch out the market, which never helps!

Have a good week.

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0 #1 DAVID PIMBLETT 2017-09-03 11:35
The main problem for the £ is the unswerving actions of the Governor of the BOE ( Carney) who seems to want Brexit to be a disaster as he forcast. He cannot abide to be seen to be wrong - .5% increase in the bank rate would solve a lot of problems but he is as stubborn as a mule ,