- Posted by currencies in Bremain, Brexit, Currency, Dollar, EUR, GBP, No Deal, Sterling, UK, Uncategorised
- January 9, 2020
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UK Prime Minister Boris Johnson and European Commission President have commenced trade talks which has led to Sterling strength in the region of 0.5% against the Euro and 0.3% against the USD. The future relationship between the EU and UK will now be the key driving factor for the single currency in the coming months. There are clear signs from both the EU and the UK suggesting Brexit negotiations will be more effective than the three years running up to the Withdrawal Agreement which has a deadline of 31st January 2020.
The UKs deadline to agree a trade deal will be December 2020 which is most definitely going to be a push for time and hence increasing the possibilities of a ‘Hard Brexit’; inevitably leading to pressure on the Pound. Failure to reach a deal will see the UK entering World Trade Organisation Rules.
Across the pond, tensions between the US and Iran seem to be calming. NATO secretary general, Jens Stoltenberg has encouraged Iran to refrain from further violence. Similarly European leaders have also please Trump release any possible conflicts of violence with Iran and not to respond to Iran’s retaliation in the means of missile attacks; although attacks were carefully designed to avoid any US casualties.
Trump commented yesterday that “the US is ready to embrace peace with all who seek it” and also Iran appearing to stand down will support no further violent actions. On the back of these comments Oil and Gold have retraced their gains since the death of Iranian general where we saw sharp rise in price of the commodities.
ADP Employment Change for the US saw a large than expected rise previously from 124K up to 202K. With the first release of the most volatile date, Non-Farm Payrolls, we could expect a sharp increase also. German Industrial production, which had faced great pressure throughout 2019 is expected to show an increase from -5.3% to -3.6%. The Unemployment Rate for the Euro-Zone is expected to stay flat at 7.5%.