Beginning of the End
[Please note: The Heritage Pay website is undergoing maintenance. So some historical pages in the Market Commentary section may not display properly.] As Currency Dealers, part of our job is to make note of trends early. It gives us valuable insights, for the benefit of our clients. Furthermore, it allows us to make correct judgments about where things are likely to go, in the unforgiving world of foreign exchange. And this week has been particularly notable for us because, we believe, it marked a major turning point for Brexit and (dare we say it!) the beginning of the end for President Donald Trump.
On Monday, the Labour Party announced it would be supporting calls for a second referendum; and if such a referendum were to be called, the party would be campaigning to remain in the EU. That was followed, in very short order by rumours that, to stave off a rebellion by up to 25 members of her cabinet, Prime Minister Theresa May would be taking a no-deal Brexit off the table. While the rumour turned out to only be partly true, the combined effect of the convergence of the Labour and Tory positions caused Sterling to shoot to a 21-month high against the Euro. It also reached multi-month highs against most major currencies.
As for Donald Trump, the Congressional testimony provided by Michael Cohen, which alleged serious moral and legal wrong-doing gave Democrats tools to begin a long, slow and painful strangulation; and we're being polite here!
See you next week.
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