- Sterling clings on despite EU comments
- Salzberg summit will be closely watched
By Joe De Berniere
The Pound climbed to a ten-week high yesterday, helped by US Dollar weakness and optimism about progress on a Brexit deal at an EU leaders summit. Sterling was up around 1 percent against the US Dollar at 1.3278 by mid-afternoon, while it climbed 0.3 percent against the Euro to 1.12891. A rally got under way early on Thursday after Cabinet Office minister, David Lidington, told Irish radio that the UK was “85-95 percent of the way” to agreeing a deal with the European Union on its exit. The Pound gathered more momentum with the release of retail sales figures, which beat expectations. Although down from July’s 0.7%, they beat forecasts of -0.2% with a 0.3% reading.
Sterling clings on despite EU comments
Sterling held its gains throughout the day despite the ongoing discussions at the EU summit in Salzberg. Donald Tusk, head of the EU Council, said that Theresa May’s proposed new economic partnership with the EU will not work. He said the plans risked undermining the EU’s single market. May said her Chequers plan is the only credible way to avoid a hard border with Ireland, but reiterated that they’re making preparations in case no deal can be reached. Reacting to Tusks’s comments, David Davis and Jacob Rees Mogg both believe that puts the end to May’s Chequers plan and it’s time to go back to the drawing board.
Ones to watch
Today the focus for the markets will be on the European Purchasing Managers’ Index (PMI) figures in the morning, followed by Canadian retail sales data in the afternoon. Ongoing reactions to the Salzberg summit will also be watched closely, so it could be an interesting day...