The pound railed 1.1% against the dollar last Thursday after a tweet! Yes, the markets are reacting to tweets now as well as statements. This tweet was quite an important one though as it came from Donald Tusk, The European Council President.
This tweet was to confirm that the EU has accepted (in principle) the deal, that Theresa May has been working on, as being acceptable to the EU, but is it acceptable to the UK or the individual EU states?
This political declaration is the second element of what is required to form the Brexit deal, if this is all accepted then there will need to be the formal withdrawal declaration.
Bearing in mind there is still a way to go, a 1.1% rise for Sterling against the dollar is not normally news but as the pound had dropped in the run up to the talks it was a welcome increase.
The pound also railed against the Euro at 0.65% which was also a good sign that the markets like the deal, or at least parts of it.
But are we there yet? In a word, no. This deal has been highlighted as too generous by Spain, France and Denmark and then there is also the UK that needs to agree to the deal, which is looking more and more unlikely.
Unfortunately, Brexit has been highjacked for political gain rather than the UK’s best interests and the next few weeks will be telling as to what deal we get and whether the recent increase in the pound is a short lived one!
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Wendy Devlin Dip CII, CeMAP, MP and ER
Source, MSN Money