Despite the craziness of the world around us right now, with serious Covid infection rates in the north of England, UK-EU trade talks heading to either no deal or the hardest of Brexits, and whatever you would call the antics of the President of the USA right now, the pound has been barely affected over the past week or two, with barely a 1% movement.
Looking at the charts for the past three months, GBP/EUR has traded within a band of around 4% and GBP/USD around 6%. These are significant swings if you have a major trade that suddenly costs you 6% more, but EUR/USD was more volatile over the past three months at around an 8% swing, without Brexit to contend with.
This may be all about to change. When we wake up to the presidential election result in exactly one month, we don’t know how the markets will react to a Joe Biden win – or electoral stalemate if the result is too close to call, or a Trump win.
By then Brexit talks will (probably) be all over and there will be either back slapping or name calling (or both), and we will either be in the grip of a new national lockdown or looking forward to Christmas.
The pound could be anywhere. Sterling will react to all this, we just don’t know which way. So if you have a major trade in the next year, please contact your trader on 020 8018 5337 to lock in your rate.
Then whatever you do with currencies in 2021 will be on your terms and no-one else’s.
