The Pound has briefly touched 1.80 against the Australian Dollar this week but has yet to make a sustained break past this particular level of resistance. However, I’m confident that the Pound will keep knocking on the door of 1.80 before eventually breaking through before the end of this month.
The political uncertainty in the UK has actually done the reverse of what many expected to happen in terms of the value of Sterling.
Clearly the Brexit deal on offer is not something that MPs have much confidence in, which saw a majority vote of 230 against the deal. Since then, the Prime Minister Theresa May has managed to once again survive a vote of no confidence with the Tories and the DUP voting in favour of supporting the Prime Minister.
The reason why the Pound has found support against a whole host of currencies including vs the Australian Dollar is because it looks more and more likely that the withdrawal from the European Union with a no deal Brexit will not happen.
Theresa May has yet to confirm officially if the UK will rule it out and I think that she is doing so to keep her negotiating power as strong as possible when she next meets with the European Union.
It appears also that the UK will attempt to extend Article 50 as it is clear that neither the UK nor the European Union is ready for the end of March.
Even though the uncertainty as to what may happen next with the Brexit talks still exists the good news for the Pound is that the finite period before the end of March may not now happen and this either moves the UK towards a softer Brexit or perhaps even no Brexit if MPs do not manage to agree on the terms of any future deal.
The market will ultimately want trade not to be adversely affected and therefore this is why I think we will see the Pound break through 1.80 during January.
I have personally worked in the foreign exchange industry since 2003 for one of the UK’s leading currency brokers and I’m able to offer you bank beating exchange rates so if you would like to save money then contact me directly for a free quote and I look forward to hearing from you.
Tom Holian [email protected]